ACT348H1 Chapter 19: ACT 348 Section 19 examples.pdf

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Consider a 10, 000 fully discrete whole life in- surance. Calculate the variance of l( a): approximate the smallest non-negative pre- mium, b, such that the probability is less than. Find the vari- ance of l( b): determine the premium, c, such that the probability of a positive total loss on 100 such independent policies is 0. 05 by the normal ap- proximation. L1 is the loss-at-issue random variable for a fully continuous whole life insurance of 1 on the life of (x) with a net level annual premium determined by the equivalence principle. You are given: (i) ax = 5 (ii) = 0. 08 (iii) v ar[l1] = 0. 5625. L2 is the loss-at-issue random variable for this insurance with a premium which is 4/3 times the annual bene t premium. Calculate the sum of the expected value of l2 and the standard de- viation of l2.

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