SOA Exam P Sample Question 560
Study guide: Exam P-1
Homeowner losses due to fire are exponentially distributed with mean 6.
Homeowners insurance policy A reimburses up to a maximum of m for a loss due to fire.
Homeowners insurance policy B, with a different premium, reimburses up to a maximum of m + 2 for a loss due to fire.
Let p_A be the probability that a loss due to fire is partially unreimbursed under policy A. Let p_B be the probability that a loss due to fire is partially unreimbursed under policy B.
Determine \dfrac{p_B}{p_A}.
- A)
e^{-12} - B)
e^{-1/3} - C)
\dfrac{1 - e^{-(m+2)/6}}{1 - e^{-m/6}} - D)
\dfrac{1 - e^{-6m-12}}{1 - e^{-6m}} - E)
\dfrac{m}{m+2}
Answer this question and see the worked solution