Edward Nissan and Iskandar S. Hamwi
Abstract
Multi-regional insurance base premiums are customarily computed by a top-down method where national or state projections are adjusted to reflect regional differences. This paper proposes a methodology for a bottom-up projection. A weighing scheme that minimizes the variance of the estimator is suggested as a criterion to establish an overall multi-regional rate.
Key words and phrases: ratemaking, loss severity, minimum variance, casualty insurance
Edward Nissan