ONLY 3&4

= = = DO List Normal No Spacing Heading 1 Heading Double-click to hide white space I Chapter 2 Practice Exercise: Measuring Risk for "Insurer A" Questions 1-5 use the table below. 5 points each, total 30 points The following is the experience of Insurer A for the last t Chapter 2 three years: Year Number of Exposures Number of Collision Claims Collision Losses ($) 10,000 375 350,000 10,000 10,000 400,000 1 2 330 250,000 3 420 1. What is the frequency of losses in year 1? Hint: What is the number of collisions claims in year 1? 2. Calculate the probability of a loss in year 1. Divide the number of collision claims in a by the total number of exposures in year 1. 3. Calculate the mean losses per exposure. Mean is "average". The average number of exposures=add all 3 years of exposures and divide by 3 because that is how many years you are averaging, 4. Calculate the mean number of collision claims. add 3 years of the numbers of collision claims and divide the total (number of years) which is 3. 5. Calculate the mean losses per collision claims. Average or mean collision losses add all three years of collision losses $$ and dived by3. 6. The experience of insurer A for the last three years was the following in the table below: What is the range of collision losses per year? Definition of range: lowest dollar loss minus (or subtract) highest dollar losse Year Number exposures number collision losses Dollar amount losses + 1 375 330 420 10,000 10,000 10,000 350,000 250.000 400.000 WN