i understand that we should pick the one that has the highest probability, but what if the probability of losing is probable and settlement expectation is both 50%, say expected to loss 50 million at 50% and 70 million at 50%, do i go expected value or the highest settlement amount, or what, if you are answering please help which number to pick and why.
thank you so much!
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Best estimate - single obligation
Hi,
You wouldn't get a scenario like this in an exam question. You would have to have one of the scenarios as being more likely than the other.
Thanks
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