You are asked to price a Worker's Compensation policy for a large employer. The employer wants...
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You are asked to price a Worker's Compensation policy for a large employer. The employer wants to buy a policy from your company with an aggregate limit of 150% of the total expected loss. You know that the distribution of the aggregate claims is lognormal. You are also provided the following: Mean Standard Deviation Number of claims 50 12 Amount of individual loss 4500 3000 Calculate the probability that the aggregate loss will exceed the aggregate limit. You are asked to price a Worker's Compensation policy for a large employer. The employer wants to buy a policy from your company with an aggregate limit of 150% of the total expected loss. You know that the distribution of the aggregate claims is lognormal. You are also provided the following: Mean Standard Deviation Number of claims 50 12 Amount of individual loss 4500 3000 Calculate the probability that the aggregate loss will exceed the aggregate limit.
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