An insurer issues 20,000 identical policies at time to to 20, 000 identical and identical...
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An insurer issues 20,000 identical policies at time to to 20, 000 identical and identical and statistically independent lives, having the following characteristics, Sum assured payable on the death before t: GHS 20,000 Expected proportion dying before t: 0.1 Single Premium : GHS 1100 The shareholder provided capital of GHS 5 million, (22.7% of the total premium of the premium income). The expenses and investment income are 5% of premium income. Estimate the
i. expectation and the risk of the claim
ii. probability of insolvency
iii. expected cost of insurance.
iv. Expected return on capital to the shareholder.
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