An insurer has classified a pool of policies into two classes: class A and class B. The probability of observing more than one claim during a single coverage period is zero for all policies and claim size is constant for all policies:

Class	Number of Policyholders	Probability of Claim	Claim Size
A	400	0.05	100
B	500	0.04	250

Using the normal approximation for aggregate losses, the insurer sets insurance rates at the lowest level that guarantees a profit 95% of the time.

Determine the rate for class B policyholders assuming that the expected profit % is the same for all policies.

1. $12.16
2. $12.77
3. $13.31
4. $26.09
5. $30.65