Annual claim payments for an insured individual


Consider an insurance policy which reimburses annual hospital charges for insured individual subject to the deductible of 5. The probability of any individual being hospitalized in the year is 15%. Once an individual is hospitalized, the charges are exponentially distributed with mean 10. Determine the expected value of the annual claim payments for an insured individual?

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Basic Statistics: Annual claim payments for an insured individual
Reference No:- TGS0848432

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