How does the applied math relate with the insurance field Assignment

How does the applied math relate with the restitution field - appellation ExampleFor example, when buying or selling an policy policy, it is important for the two parties to understand the risks involved. These risks are analyzed, and their blow evaluated. This helps in determining the actual amount of the policy and the terms of collapsement.Secondly, numeral techniques are utilize in analyzing public utility curves. These curves are useful in determining how much a consumer is going to buy damages for (Green, 96). In normal cases, the insuring firm has to bearing the customer a fee more than the value of the risk. The utility curves thus help the insurance company determine the exact amount the customer is going to pay for the insurance. For example, if a consumers average loss per year for repairing his car is $10000, then the insurance company has to charge a fee above this figure for the insurance. This can only be achieved if mathematical techniques are used so as to c alculate the actual profit percentage that the insurance company will charge.Thirdly, the insurance sector firmly relies on market research in the development of the various policies and understanding of the real ones (Green, 97). Market research helps the insurance firms understand the best policies that will satisfy the demands of the market. For example, a company mightiness want to study the market potential before developing a new insurance policy. In order to avoid losses, the company needs to have accurate information about the market. Mathematics is heavily applied in market research. For instance, random sampling can be employed by the insurance firms to understand various phenomenons in the market. In order to effectively collect, organize and analyze such(prenominal) data, mathematical techniques are required for accuracy. In particular, statistical methods are used in marketing research where variables such as standard deviation and variance help in the analysis of th e collected data.Finally, applied math is useful when it