General InsuranceSeen in 58 questions
Law of Large Numbers
The statistical principle that the larger the number of similar exposure units observed, the more closely actual losses will match expected losses. It is the foundation of predictable insurance pricing.
Drill all 803 terms as flip-card flashcards in the Exam Engine →
Practice This Concept
- General InsuranceThe law of large numbers makes insurance possible primarily because:
- General InsuranceFor the law of large numbers to improve the accuracy of loss prediction, the exposures …
- General InsuranceThe law of large numbers enables accurate prediction because, as the number of similar …
- General InsuranceAn A&H insurer uses a morbidity table to price a block of disability policies. The law …
- General InsuranceA health insurer considers writing a block of disability policies covering only 100 sim…
- General InsuranceThe law of large numbers allows an insurer to predict losses accurately when a large nu…
Practice all general insurance questions →