Modelling the disability severity score in motor insurance claims: an application to the Spanish case

Miguel Santolino () and Jean-Philippe Boucher ()
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Miguel Santolino: Faculty of Economics, University of Barcelona
Jean-Philippe Boucher: Département de Mathématiques, Université du Québec à Montréal

No 200902, IREA Working Papers from University of Barcelona, Research Institute of Applied Economics

Abstract: Bodily injury claims have the greatest impact on the claim costs of motor insurance companies. The disability severity of motor claims is assessed in numerous European countries by means of score systems. In this paper a zero inflated generalized Poisson regression model is implemented to estimate the disability severity score of victims in-volved in motor accidents on Spanish roads. We show that the injury severity estimates may beautomatically converted into financial terms by insurers at any point of the claim handling process. As such, the methodology described may be used by motor insurers operating in the Spanish market to monitor the size of bodily injury claims. By using insurance data, various applications are presented in which the score estimate of disability severity is of value to insurers, either for computing the claim compensation or for claim reserve purposes.

Keywords: Motor accident; disability severity; zero-inflated generalized Poisson model; disability scoring scale. (search for similar items in EconPapers)
Pages: 25 pages
Date: 2009-01, Revised 2009-01
New Economics Papers: this item is included in nep-ias
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:ira:wpaper:200902

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