In this workout, we've got to calculate the payout pattern for historical claims expenses. So we're taking the historical period and we're saying from that historical period, what are the remaining claims that have to be paid out? So in the historical year we've got 6,997 of claims expense.

Now, because it's a historical year, the year one's claims expense would've been paid out already. So we're just working on year two, three, four, five, et cetera. Now you can see here over the course of a 10 year period this is our assumed payout pattern from 53.9% in year one all the way down to just 0.4% in year 10. And you can see, just looking at the bottom that this adds up to a hundred percent. So let me just sum that up to show you. So that adds up to 100%. So what we're going to do is we're going to for a projection, we're going to say, let's look at the remaining payout that's going to happen for all those historical policies that the company has written in the past. So if we take that first item and I'm going to absolute reference it, I'm not going to multiply by the 53.9% because this, remember, that happened last year. What I'm going to multiply it by is the year two's percentage. And this is because actually we are in year two of that policy. So there's 24.2 to be paid out and then I can copy that right. And if I keep on copying that right you can see I can't actually copy it to year 10 because in year 10, what's happening is it's actually using that a hundred percent. So I'm just going to delete that because by year nine this policy, or this claim expense, is completely paid out because we've taken the 53.9% in that historically already and we're just forecasting the payout of the remaining percentage. Go back another year, so two years prior, I'm going to take the claims expense, absolute reference that, and I'm going to multiply that not by year one, because that's already come out in the historical year minus two, not year two, because that's already come out in the historic year minus one. But year three, and then I'm going to copy that right. And again, I can't copy it to year nine, I've got to copy it to year eight because we only have eight years left of that policy. And so what I'm going to do is I'm gonna continue doing this absolute referencing and then multiplying by not year one in this case, not year two, not year three, because they've had three years already, but year four. And then I'm gonna copy that right to year seven. So you actually end up building a triangle of numbers here. And again this is year four, so we've had four years' worth. And so I'm gonna start by year five and then copy that right to year six, and I'm going to continue. So just watch me as I complete this analysis.

Now you can see here that I'm not going to do year 10 or the claims expense 10 years ago because it was 10 years that this claims expense happened and that meant that the full payout will have happened in the historical period. So there'll be nothing left to pay going forward. So what I can now do is I can sum up these numbers and this will give me the total amount of payout or cash I've got to pay out each year going forward based on the historical policy book. And this will help us in our projections because this is the historical reserves which are being paid out. So as you'd expect, as they become fully paid out the amount that we're paying out is getting smaller and smaller over time.