On the aggregation of experts' information in Bonus-Malus systems
V\'ictor Blanco, Jos\'e M. P\'erez-S\'anchez
TL;DR
This paper introduces a novel premium calculation method that integrates multiple sources of prior information using OWA operators, offering alternative collective and Bayes premiums with practical computation approaches.
Contribution
The paper presents a new premium computation framework based on OWA operators, incorporating multiple prior information sources, which is a novel approach in insurance premium setting.
Findings
Proposes a new premium computation principle using multiple prior sources.
Introduces alternative collective and Bayes premiums based on OWA operators.
Provides examples illustrating the application of the new framework.
Abstract
We present in this paper a new premium computation principle based on the use of prior information from multiple sources for computing the premium charged to a policyholder. Under this framework, based on the use of Ordered Weighted Averaging (OWA) operators, we propose alternative collective and Bayes premiums and describe some approaches to compute them. Several examples illustrates the new framework for premium computation.
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