Recognizing (a,b,0) and (a,b,1) Distributions

Free SOA Exam FAM (Fundamentals of Actuarial Mathematics) lesson in Severity, Frequency, and Aggregate Models. 10 min read, ~1,530 words.

(a,b,0) has exactly four members: Poisson, binomial, negative binomial, geometric. (a,b,1) adds all zero-truncated/zero-modified versions, plus logarithmic ( ). Logarithmic has, no mass at zero, and no (a,b,0) counterpart. ZT rescaling:. Same recursion factors, different starting value. Start the (a,b,1) recursion at, never; deriving from a zero makes every probability...

What this lesson covers

• Content
• Example 1
• Example 2
• Common Mistakes
• Check Your Understanding
• Exam Shortcuts

Learning objectives

• 2f

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