When to redistribute probabilities?

[DudeMan]

Originally Posted by blackbeard

62.43 N-Pr(N=n) - 0-.5,1-.2,2-.2,3-.1. Loss-Pr)L=l) 1000-.5, 200-.1, 3000-.1, 5000-.3. 1000 Per claim deductible is imposed. Calculate Std Dev of insurers loss.

Ok, after typing these out and actually rereading the problems I think I figured out where the problem lies. One is asking for the Payment Per Payment while the second one asks for the Payment Per Loss. So The first is condition on it being greater than the deductible, correct? Let me know if this is right.

62.43
The Frequency distribution stays the same since we are looking at losses(not payments).....Severity distr will change though
X, P(X)
0, .5
1000, .1
2000, .1
4000, .3

E(N)=.9
E(N^2)=1.9
VAR(N)=1.09
E(X)=1500
E(X^2)=5,300,000
VAR(X)=3,050,000

E(S)=1,350
VAR(S)=5,197,500
StDev(S)=2,279.8