An insurance company sells a health insurance policy that covers hospitalization expenses up to a maximum of
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An insurance company sells a health insurance policy that covers hospitalization expenses up to a maximum of $50,000 per year for each insured person. The company charges an annual premium of $1,200 for this policy. The probability that a person will be hospitalized in a given year is 0.05. The company expects to sell this policy to 500 individuals. What is the expected profit or loss for the insurance company?
Related Book For
Statistics The Art And Science Of Learning From Data
ISBN: 9780321755940
3rd Edition
Authors: Alan Agresti, Christine A. Franklin
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