Question

please dont answer my by excel .. would be better if use your PC to answer ,, as well as provide the formula

(b) Impian Sdn. Bhd has the following distribution for its annual medical costs: Loss = RM2,000,000 with probability 0.0001 RM100,000 with probability 0.001 RM5,000 with probability 0.1 RMO with probability 0.8989 What are the expected claim costs for Impian Sdn. Bhd? (4 marks) If an insurer offered Impian Sdn. Bhd a policy with a RM5000 annual deductible, what are the expected claim costs on this policy? (4 marks) If an insurer offered Impian Sdn. Bhd a policy with a RM500,000 limit, what are the expected claim costs on this policy? (4 marks) iv. Explain why these contractual provisions such as limits and deductibles are important from the insurance company's point of view. (4 marks)

Answer 1

Stension: (icomputation of Loss amount costs :- expert claims probability (loss) x (probablity) 20,00, 000 1,00,000 0.0001 0.001 200 100 5000 Oil 500 0.8989 Total 8000 rés computation of expected claims costs; LOSS Amount probability I (Loss Amount) probability 5000 0.001 Sooo 0.001 5000 0.1 018989 Total รัOS. ๒ computation of Los San Amount | experted Dorobability cloums costs"; 1 Moss Amaceud (probabilitoll 15,00, 000 0.0001 O 0.001 O 0.1 O 0.8989 Total 150

W mce C пц Ou noc an . (io) As for the policy that defines the marimum amount, am insurance company needs to pay for a policy's covered loss. However, Deductibles are the amount that a policy holder needs to pay before an insurer will pay the amount of loss insured under the policy. Hence both the forms defines the liability of an insurance company