**Problem 20-A**

You are given the following:

- The annual number of claims generated from a portfolio of insurance policies follows a Poisson distribution.
- The claim size is modeled by the random variable where has an exponential distribution with mean 2.
- The number of claims and the claim sizes are independent.
- The full credibility standard has been selected so that actual claim costs will be

within 5% of expected claim costs 95% of the time.

Using limited fluctuation credibility, determine the expected number of claims required for full credibility?

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**Problem 20-B**

You are given the following:

- The annual number of claims generated from a portfolio of insurance policies follows a Poisson distribution.
- The claim size is modeled by the random variable where has an exponential distribution with mean 2.
- The number of claims and the claim sizes are independent.
- The full credibility standard has been selected so that actual claim costs will be

within 5% of expected claim costs 95% of the time.

Using limited fluctuation credibility, determine the expected number of claims required for full credibility?

___________________________________________________________________________________

___________________________________________________________________________________

___________________________________________________________________________________

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Tagged: Actuarial Exam, Aggregate Claims, CAS Exam 4, CAS Exam 4 Practice Problem, Exponential Distribution, Frequency, Frequency-Severity Model, Full Credibility Standard, Limited Fluctuation Credibility, Loss Models, Poisson Claim Frequency, Poisson Distribution, Poisson-Gamma Model, Probability, Pure Premium, Severity, SOA Exam C, SOA Exam C Practice Problem

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