Annual variation of losses in chicago

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Assume that a property insurer has 10,000 homes insured in Hartford, CT and 10,000 homes insured in Chicago, IL. The chance of fire in each city is 2 percent. The annual variation in losses ranges from 180 to 220 in Hartford. Knowing that the objective risk is higher in Chicago than Hartford, what is the annual variation of losses in Chicago? Explain using two paragraphs.

Reference no: EM132951402

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