Question
1- If an insurance company issues 4,900 theft insurance policies, with an average insurance amount of 3,000 riyals per policy, and the theft loss rate
1- If an insurance company issues 4,900 theft insurance policies, with an average insurance amount of 3,000 riyals per policy, and the theft loss rate is 30%, then what is the value of the risk from the company’s point of view?
2 - If out of every 1,000 houses in the city of Riyadh, 10 houses are burned per year, and the average value of one loss is 1,000 pounds, and assuming that the value of the house is 50,000 pounds, determine the rate of loss due to fire with comment?
3 - Assuming that the number of branches owned by Al Saada Import and Export Company is 144 branches, while the value at risk is 8 million riyals and that the loss rate is 0.003, find the maximum possible material loss facing this company.?
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Corporate Finance
Authors: Jonathan Berk and Peter DeMarzo
3rd edition
978-0132992473, 132992477, 978-0133097894
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