b ) XYZ Company specializes in the production of Suds - Away , an environmentally friendly dishwashing detergent for homes . The net worth of XYZ company is GH 2,000,000 . The Company's liability exposure , L , for the coming year is given by GH 0 with probability 0.975 L = GH 250000 with probability 0.015 ( 1000000 with probability 0.01 I. The administrative charge of the company's insurers GH 1000 is incurred at the inception of the insurance contract . Suppose insurers fair profit loading GH 500 , and that the interest rate is 5 % , determine the fair premium in each of the following cases . i ) Full insurance ii ) GH 50000 deductible and 20 % co - insurance . iii ) GH 50000 deductible , 20 % co - insurance and GH 750000 limit . II . Write down the wealth distribution of XYZ Company . Use the concave utility function to assess the fairness of the full insurance charged by its insurers . u(x) = sqrt(x)