Model insurance claim frequency and severity.
Free CAS MAS-I (Modern Actuarial Statistics I) lesson in Statistics. 10 min read, ~1,569 words.
Frequency: Poisson ( ), Negative Binomial (over-dispersed), Binomial (under-dispersed). The class covers all three, identified from a plot of. Variance-to-mean ratio classifies the family: below 1 binomial, near 1 Poisson, above 1 negative binomial. Negative binomial is the gamma-mixed Poisson model for heterogeneous portfolios, inflating variance above the mean. Severity...
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What this lesson covers
- Content
- Example 1
- Example 2
- Common Mistakes
- Check Your Understanding
- Exam Shortcuts
Learning objectives
- B5
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