Which expression correctly describes the right-hand side of the formula for Part 3's Prior Years Row (2nd rightmost column plus something)?

• A. Part 3 2nd right most column + (D&A loss - ceded loss)
• B. Part 3 2nd right most column - (D&A loss - ceded loss)
• C. Part 3 2nd right most column + (D&A loss - ceded loss + D&A DCC - ceded DCC)
• D. Part 3 2nd right most column + (D&A loss - ceded loss + D&A DCC + ceded DCC)

Answer: (C)

The right-hand side needs to include all prior-year adjustments that feed into Part 3, coming from two streams: the net D&A loss (D&A loss minus ceded loss) and the net D&A DCC (D&A DCC minus ceded DCC). You take the 2nd rightmost column and add the combined net effect of both streams. That means adding (D&A loss − ceded loss) and (D&A DCC − ceded DCC). Using this combined net adjustment preserves the proper accounting of both the D&A and DCC components for prior years.

Omitting either part or using the wrong sign would misstate the prior-year adjustment, which is why the expression with both differences and the correct signs is the correct one.