Insurance Probability and Expected Value

The video tutorial explores the concept of probability distribution in the context of life insurance. It discusses a one-year term life insurance policy for a 45-year-old man, detailing the premium and payout in case of death. The tutorial calculates the probability of death and the expected gain for the insurance company, explaining the financial implications of selling such policies. It concludes with an analysis of the expected gain per policy when selling multiple policies.

What is the main focus of the video tutorial?

• Probability distribution in life insurance

• Investment strategies

• Car insurance claims

• Health insurance policies

What is the annual premium for the one-year term life insurance policy?

• Rupees 12

• Rupees 1000

• Rupees 20

• Rupees 500

What age range is considered for the insurance policy?

• 43 to 44 years

• 44.5 to 45.5 years

• 45 to 46 years

• 44 to 45 years

What is the expected gain for the insurance company on a policy of this type?

• Rupees 12

• Rupees 5

• Rupees 7

• Rupees 10

What happens if the policyholder dies within the policy term?

• The company loses Rupees 988

• The company loses Rupees 12

• The company gains Rupees 12

• The company gains Rupees 1000

What is the probability of death for the policyholder?

• 1 in 1000

• 5 in 1000

• 10 in 1000

• 20 in 1000

What is the outcome if the policyholder does not die within the policy term?

• The company gains Rupees 12

• The company pays Rupees 1000

• The company loses Rupees 12

• The company gains Rupees 1000

What is the probability of the policyholder not dying?

• 20 in 1000

• 10 in 1000

• 5 in 1000

• 995 in 1000

What is the expected gain per policy for the insurance company?

• Rupees 12

• Rupees 5

• Rupees 7

• Rupees 10

What does the expected value represent in this context?

• The total premium collected

• The average gain per policy

• The total loss incurred

• The number of policies sold