SOA Exam P Sample Question 526
Study guide: Exam P-1
A company insures homes in 50 different territories. The company models annual tornado losses within each territory by an exponential distribution with mean 100,000. Because of the local nature of most tornadoes, losses in one territory are independent of losses in other territories.
Calculate the approximate probability that total annual tornado losses over all 50 territories exceed 5.5 million.
- A)
0.14 - B)
0.18 - C)
0.24 - D)
0.33 - E)
0.46
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