distinguis between life and non life insurance
Added by Jeherul I.
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Purpose: Life insurance is designed to provide financial security to the policyholder's dependents in the event of his/her death. Non-life insurance, on the other hand, is intended to protect the policyholder's assets, such as a car or a house, against potential Show more…
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Key Concepts
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Life Insurance An insurance company issues life insurance policies in three separate categories: standard, preferred, and ultra-preferred. Of the company’s policyholders, 50% are standard, 40% are preferred, and 10% are ultra-preferred. Each standard policyholder has probability 0.010 of dying in the next year, each preferred policyholder has probability 0.005 of dying in the next year, and each ultra preferred policyholder has probability 0.001 of dying in the next year. A policyholder dies in the next year. What is the probability that the deceased policyholder was ultra-preferred? Choose one of the following. Source: Society of Actuaries. a. 0.0001 b. 0.0010 c. 0.0071 d. 0.0141 e. 0.2817
Sets and Probability
Bayes’ Theorem
Maybe you have considered buying a term life insurance policy. The expected value of any term life insurance product yields a positive expected value for the insurance company and a negative expected value for you, meaning the insurance company will make profits by selling their insurance products. Would you still buy the term life insurance? Why or why not? Are there other examples other than insurance that uses this same concept?
Prashant B.
28. Life Insurance A life insurance company sells a 250,000 dollar 1-year term life insurance policy to a 20 -year-old male for 350 dollar. According to the National Vital Statistics Report, $58(21),$ the probability that the male survives the year is $0.998734 .$ Compute and interpret the expected value of this policy to the insurance company.
Discrete Probability Distributions
Discrete Random Variables
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