Financial Risk Manager Part 1
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Given the following chart describing the claims of an auto insurer during a policy period, calculate P(C|M).
| Male (M) | Female (F) | Total | |
|---|---|---|---|
| Claim (C) | 100 | 200 | 300 |
| No Claim (X) | 400 | 600 | 1000 |
| Total | 500 | 800 | 1300 |
Other
Community
NNikitesh
A
8%
B
10%
C
20%
D
23%
Explanation:
Explanation:
P(C|M) represents the conditional probability of having a claim given that the policyholder is male. This is calculated as:
From the table:
- Number of male claimants (C ∩ M) = 100
- Total number of males (M) = 500
Therefore, the probability that a male policyholder files a claim is 20%.
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