Assume your insurance company offers you a $750 premium for insurance on your house if you are a regular client. Regular clients have a 0.03% chance of having their $350,000 house burnt down, and a 0.6% chance of having $10,000 damage to their home. On the other hand, you can choose to pay a $200 premium if you agree to a $2,000 deductible. Clients who accept the deductible have a 0.02% chance of having their entire house burn down and a 0.3% chance of having

$10,000 damage to their home. Which premium should you choose assuming γ = 1 and your liquid wealth is $400,000?