Personal accident i. Describe the main coverage of personal accident insurance and give an example of a benefit schedule.

ii. Mention two composite personal lines product to which personal accident is normally attached and explain why personal accident is relevant to these products.

iii. Explain why a fixed benefit schedule is typically used for PA.

iv. It is 5 February 2014. The following statistics are available for the policy years 2008 to 2012 for a portfolio of personal accident policies offering identical death benefits as specified in the table below (the amount of benefit is changed at the beginning of the year for all policies incepting in that year).

Policies Incepting on Year No. of Deaths Amount Offered for Death Benefits across All Policies [£M]
Total Loss to the Insurer [£M]
2008 2500 1.20 3000 2009 2250 1.20 2700 2010 2610 1.30 3393 2011 2405 1.50 3608 2012 2550 1.60 4080 2013 N/A 1.60 N/A Calculate the total losses related to the death benefits that you expect for the portfolio of policies incepting in 2013, stating all assumptions you make.
v. What frequency model would be adequate for the number of losses in 2013? Why?