An actuary is establishing reserves for a group of policies as of December 31, CY3. You are given the following table of reserve estimates for AY1 and AY2:

where [math]R_{BF}[/math] is the loss reserve under the Bornhuetter-Ferguson method, [math]R_{LR}[/math] is the loss reserve under the Expected Loss Ratio method, and [math]R_{CL}[/math] is the loss reserve under the Chain Ladder method.

If [math]f_2[/math], the loss development factor from the paid-loss-development triangle at duration 2, equals 1.05, determine the reserve estimate as of December 31, CY3 using the chain ladder method.

• 950,000
• 1,050,000
• 1,100,000
• 1,150,000
• 1,200,000