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Jun 01'22
Exercise
The joint distribution of claim frequency and claim severity, conditional on the claim frequency being positive, is given below:
Claim Size Claim Frequency |
100 | 300 | 500 | 1000 |
---|---|---|---|---|
1 | 0.25 | 0 | 0.2 | 0 |
2 | 0 | 0.37 | 0 | 0.18 |
If the probability that the claim frequency is zero is 0.75, determine the variance of the claim frequency.
- 0.2475
- 0.5123
- 0.6625
- 0.8833
- 1