Insurance question involving net premium
An insurance company sells a one-year automobile policy with a deductible of two. The probability that the insured will incur a loss is 0.05. If there is a loss, the probability of a loss amount 𝑁 is 𝐾⁄𝑁 for 𝑁 = 1, 2, 3, 4, 5 and some constant 𝐾. These are the only possible loss amounts and no more than one loss can occur. Determine the net premium for this policy.
Markgvanzalk
96
Answer
Answers can only be viewed under the following conditions:
- The questioner was satisfied with and accepted the answer, or
- The answer was evaluated as being 100% correct by the judge.
1 Attachment
Kav10
2K
The answer is accepted.
Join Matchmaticians Affiliate Marketing
Program to earn up to a 50% commission on every question that your affiliated users ask or answer.
- answered
- 764 views
- $10.00
Related Questions
- Probability problems (Permutations, Combinations, law of inclusion and exclusion)
- Figuring out the maths for the probability of two adopted teens randomly being matched as pen pals in 2003
- Statistics and Probability
- Probabilty question
- A-Level Probability Counting Problem
- Probability of drawing a red ball, given that the first ball drawn was blue?
- Stochastic Processes Questions
- Foundations in probability