1. Darn Berthad has distobrered the loss detibution faced by each project as follows: The fikk peerrium for Alam Darnai and Mesra Alam are 4.3 percerk and 2.8 percent sespecthely and risk-free rate is 7.2 percert for boel trejects. Adsitional information: six years for Mesra Alom (1) Marketirg experses are 11.4 percerve of the expocled claim cost (ii) Loss adjustment expenses for Alam Camai and Mesre Alat are 24 petcent and 26.6 petcent of the expected claim cast respectively. (iv) Premium tsues oosh gre 875 petcent of expected claim soat. (v) Underwriting costs lor Alum Damai and Metrst Alam are 23.3 percent and tD.6 percent of expecied claim eevit reseectively. (v) Profe laading it 5.5 percent ef expected claim east. (vii) Coet of claim processing is RM123.es0 for Alam Damai and Pau190,675 for Meara Aiam. Based on the information above, calculate the feir poemium for each project. [20 mork] 2. Strinan is in etogineer who lasnched two tranches workshop at Gonbak and Petaling Jaya last moren. As an owtier of the business. he rebizes that company's bobs may not be high with certainty. The capital for Gombak and Petaling Jays branchas are RMS0.000 and RMW7.800 respectively. The probablity of loss Docur for Gombak is 0.07 with onet equal to Ruts.5po. Hewever, the probatilify of loss ocour for Peicaling Jaya is policien and the following a the informatien for each peliey: Eased on the information above, calcuiats and justy the expected weath of each insurase policy for each assembly unts. (20 marks) FESK MANAGENCNT 1/2 CONFIDENTLAL 3. Chithurst Co gained a share exchange listing five years ago. A the time of the listing. members of the family who founded the compary ownad 75 percert of the shares. insurense poticy for each assemtly units. (20 maks) ISK MANAGENENT 1/2 ONFIOENTLAL Chithurst Co gained a shore exchange listing five years ago. Au the tine of the listing. memters of the family who founded the company ownad 75 periert of the shoves. but now they cilly hold just over 50 persent. The companies aso has punchased an inturance pian to minimate the firancial detress in the following. The companies have historical losses incurred as follows: Determine the expected anourt paid by inuare is the corrsanins for each policy. (30 maks) Betry, Carsi and Emly decide to posi their lesses. The ioss distrbutisns fased by them are listed below. Calodale the expected loas and stasdard deviebien for both ouscomes without and wh the shating arrargement. (30 marks)
