"That's liability insurance. No test is perfect, and if one of our tests fails -- for example, if one of our tests says a patientdoesn'thave Covid-19, when really they do -- they would certainly sue us.The probability of such failures is low, but Andre says if it happened we would be sued, and we would almost certainly lose, and the payout would likely be something like $2,000,000. The insurance would be to help in such a situation."

Perform a sensitivity analysis: How high would the chance of a device failing have to be, in order for the insurance described above to be a good idea? (Assume a maximum coverage of $1,500,000.)Show your math.