SOA Exam P Sample Question 306
Study guide: Exam P-1
An insurance company sells 40% of its renters policies to home renters and the remaining 60% to apartment renters. Among home renters, the time from policy purchase until policy cancellation has an exponential distribution with mean 4 years, and among apartment renters, it has an exponential distribution with mean 2 years.
Calculate the probability that the policyholder is a home renter, given that a renter still has a policy one year after purchase.
- A) 0.08
- B) 0.27
- C) 0.46
- D) 0.56
- E) 0.66
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