Calculate limited expected value.
Free CAS MAS-I (Modern Actuarial Statistics I) lesson in Probability Models. 11 min read, ~1,642 words.
Limited expected value:, the expected loss after capping at limit. Survival form (easiest for parametric): for non-negative. Layer formula: expected payment in layer equals; stop-loss. Loss elimination ratio:. Exponential:. Pareto ( ):.
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Key Takeaways
- Exam Shortcuts
Learning objectives
- A3
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