Actuarial Outpost exposures vs claim count for classical credibility
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 Short-Term Actuarial Math Old Exam C Forum

#1
05-26-2018, 07:48 PM
 royevans Member SOA Join Date: Jul 2017 Posts: 466
exposures vs claim count for classical credibility

I am confused as to whether a question is asking for credibility for exposures or claim counts... can someone tell me when to use which?

I've attached a problem below... what is the giveaway in the problem that says you need to use exposures?
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#2
05-26-2018, 08:17 PM
 ARodOmaha Member SOA Join Date: May 2016 Location: Omaha, NE Studying for MFE College: University of Nebraska (alma mater) Favorite beer: Captain Morgan Posts: 180

Because of part (iii) I would immediately start solving for n_c, the number of claims for credibility. Then later they are asking a comparison with the group size as the variable n. Group size comes from the number of people, or exposures. So convert n_c to n_e by dividing by the frequency mean (btw, just memorize the n_c formulas then convert if needed).

I can't say I've seen too many ambiguous problems; they usually specify exposures if they want exposures.
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