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Mathematics, 15.04.2020 03:44 tinasidell1972
An insurance company sells an auto insurance policy that covers losses incurred by a policyholder, subject to a deductible of 100. Losses incurred follow an exponential distribution with a mean of 300.
Calculate the 95th percentile of actual losses that exceed the deductible. Give your answer rounded to the nearest whole number. Hint: You can either do this one ‘directly’ or you can use the ‘memoryless’ property of the exponential distribution.
A) 600 B) 700 C) 800 D) 900 E) 1000
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