SOA Exam FAM Sample Question 61
Study guide: Exam FAM
For an aggregate loss distribution S:
(i) The number of claims has a negative binomial distribution with r = 16 and \beta = 6.
(ii) The claim amounts are uniformly distributed on the interval (0, 8).
(iii) The number of claims and claim amounts are mutually independent.
Calculate the premium such that the probability that aggregate losses will exceed the premium is 5% using the normal approximation for aggregate losses.
- A) 500
- B) 520
- C) 540
- D) 560
- E) 580
Answer this question and see the worked solution
Concepts tested
- Aggregate Loss Model
- Normal Approximation
- Negative Binomial Distribution
- Uniform Continuous Distribution