Basic HTML Version
Q
uantitative
R
easoning &
P
roblem
S
olving
122
© 2014 Pacific Crest
A
re You Ready?
Before continuing, you should be able to ...
I can...
OR
Here’s my question...
enumerate an event space
classify an event on the likelihood scale
determine the number of outcomes in an
event
explain the steps of the methodology for
determining likelihood of an event
P
lan
How to complete the activity
If using team roles, assign the following:
●
Mathematician
(the “numbers” person specializing in calculation)
●
Critical Thinker
(the team’s skeptic)
●
Manager
(the team’s leader and spokesperson)
●
Recorder
(the person who assembles and presents data)
●
Quality Control Officer
(the person who ensures team’s performance meets the criteria)
1. Analyze the Model using the Methodology to take on the perspective of the insurance company.
2. Answer Critical Thinking Questions.
3. Try a few of the Demonstrate Your Understanding problems.
4. Produce a report to describe how insurance companies can actually make money.
5. Complete the remainder of this activity (from Demonstrate Your Understanding through Assessing
Your Performance) on your own, or as directed by your instructor.
M
odel(s)
Exemplars and representations
T
erm
L
ife
I
nsurance
A
nalysis
: L
ikelihood of
D
eath
G
iven
H
ealth
C
onditions
Scenario:
You are 40 years of age, your want thirty years of protection, you want a $500,000 policy
Preferred Plus $630/year premiums for 30 years × $630 = $18,900
●
You lose if you survive (
Insurance company gets $18,900 with no costs to them
)
●
You win if you die (
Insurance company loses $500,000 minus any premiums
collected
)