Practical Aspects of Credibility Theory Aiming the Hierarchical Model with Two-Levels

Virginia Atanasiu and Daniela Mihaela Vladu
Additional contact information
Virginia Atanasiu: The Academy of Economic Studies
Daniela Mihaela Vladu: "Dimitrie Cantemir" Christian University, Bucharest

Romanian Statistical Review Supplement, 2012, vol. 60, issue 2, 29-43

Abstract: It is an original paper, which shows how the hierarchical model with two levels, can be used to determine the linear non-homogeneous credibility premiums at the sector level and at the contract level. The fact that it is based on complicated mathematics, involving conditional expectations, shouldn’t bother the user more than it does when he applies statistical tools like SAS, GLIM, discriminant analysis, and scoring models. These techniques can be applied by anybody on his own field of endeavor, whether it is economic, medical, insurance, or accounting. We give a rather explicit description of the input data for the used hierarchical model of Jewell, only to show that in practical situations there will always be enough data to apply credibility theory to a real insurance portfolio.

Keywords: risk; risk parameter; observable variables with associated weights; conditional expectations. (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.revistadestatistica.ro/suplimente/2012/2/srrs2_2012a04.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:rsr:supplm:v:60:y:2012:i:2:p:29-43

Access Statistics for this article

More articles in Romanian Statistical Review Supplement from Romanian Statistical Review Contact information at EDIRC.
Bibliographic data for series maintained by Adrian Visoiu ().