scholarly journals Diffusion approximations in collective risk theory

1969 ◽  
Vol 6 (2) ◽  
pp. 285-292 ◽  
Author(s):  
L. Donald Iglehart
Keyword(s):  
Large Deviations ◽  
Risk Premium ◽  
Risk Theory ◽  
Insurance Company ◽  
Diffusion Approximations ◽  
Security Risk ◽  
Insurance Policies ◽  
Collective Risk ◽  
A Company ◽  
Random Times

Collective risk theory is concerned with the random fluctations of the total assets, the risk reserve, of an insurance company. Consider a company which only writes ordinary insurance policies such as accident, disability, fire, health, and whole life. The policyholders pay premiums regularly and at certain random times make claims to the company. A policyholder's premium, the gross risk premium, is a positive amount composed of two components. The net risk premium is the component calculated to cover the payments of claims on the average, while the security risk premium, or safety loading, is the component which protects the company from large deviations of claims from the average and also allows an accumulation of capital. When a claim occurs the company pays the policyholder a positive amount called the positive risk sum.

scholarly journals Diffusion approximations in collective risk theory

1969 ◽  
Vol 6 (02) ◽  
pp. 285-292 ◽  
Author(s):  
L. Donald Iglehart
Keyword(s):  
Large Deviations ◽  
Risk Premium ◽  
Risk Theory ◽  
Insurance Company ◽  
Diffusion Approximations ◽  
Security Risk ◽  
Insurance Policies ◽  
Collective Risk ◽  
A Company ◽  
Random Times

Collective risk theory is concerned with the random fluctations of the total assets, the risk reserve, of an insurance company. Consider a company which only writes ordinary insurance policies such as accident, disability, fire, health, and whole life. The policyholders pay premiums regularly and at certain random times make claims to the company. A policyholder's premium, the gross risk premium, is a positive amount composed of two components. The net risk premium is the component calculated to cover the payments of claims on the average, while the security risk premium, or safety loading, is the component which protects the company from large deviations of claims from the average and also allows an accumulation of capital. When a claim occurs the company pays the policyholder a positive amount called the positive risk sum.

scholarly journals Self-similar processes in collective risk theory

1998 ◽  
Vol 11 (4) ◽  
pp. 429-448 ◽  
Author(s):  
Zbigniew Michna
Keyword(s):  
Long Range ◽  
Risk Model ◽  
Queueing Systems ◽  
Risk Process ◽  
Risk Theory ◽  
Similar Process ◽  
Long Range Dependence ◽  
Insurance Company ◽  
Collective Risk ◽  
Self Similar

Collective risk theory is concerned with random fluctuations of the total assets and the risk reserve of an insurance company. In this paper we consider self-similar, continuous processes with stationary increments for the renewal model in risk theory. We construct a risk model which shows a mechanism of long range dependence of claims. We approximate the risk process by a self similar process with drift. The ruin probability within finite time is estimated for fractional Brownian motion with drift. A similar model is applicable in queueing systems, describing long range dependence in on/off processes and associated fluid models. The obtained results are useful in communication network models, as well as storage and inventory models.

scholarly journals Experience Rating A New Application of the Collective Theory of Risk

1962 ◽  
Vol 2 (2) ◽  
pp. 261-270 ◽  
Author(s):  
Hans Ammeter
Keyword(s):  
Risk Premium ◽  
Risk Theory ◽  
Experience Rating ◽  
Practical Applications ◽  
Insurance Cover ◽  
Collective Risk ◽  
Premium Calculation ◽  
The Individual ◽  
Image Position ◽  
Stop Loss

Besides its well known applications, the collective risk theory has recently also been applied to problems connected with the so called Experience Rating. This term is used to define a method of premium calculation in insurance business which is based partially or totally on the individual experience of the particular risk involved. It is obvious that Experience Rating is essentially applicable to collective insurances which contain no saving element. In practical applications various possibilities may be considered.The collective theory of risk provides an efficient calculus for the analysis of the various forms of Experience Rating and in paper [3] a particular form of Experience Rating for collective insurances is examined. It is there assumed that the collective risk premium is based on experience derived from non-individual observations. If any cost loading is disregarded, the net premium is given by the relation P′ = (I + λ) P, where λ is a security factor and P the part of the premium covering the expected claims cost.A premium refund is to be deducted from the basic net premium P′. In this formula α′ and β are suitable numerical values and S means the due sum to be paid out for claims. Hence the net cost to the group considered depends on the actual claims S and therefore takes into account the individual claims experience. It may be shown that for β = I the form of Experience Rating considered is equivalent to a stop loss cover. The general case with β ≠ I represents a combination of ordinary insurance cover and stop loss cover.

Dealing with Misselling: Impact of Behavioural Interventions on Insurance Agents

2021 ◽  
pp. 263145412098771
Author(s):  
Biju Dominic ◽  
Reshmi
Keyword(s):  
Control Mechanism ◽  
Self Control ◽  
Insurance Company ◽  
Ethical Challenges ◽  
Behavioural Interventions ◽  
Insurance Agents ◽  
Insurance Policies ◽  
Ethical Violations ◽  
Long Run

This case study is about misselling of insurance policies and associated ethical challenges in a leading insurance company. Pro-organisational ethical violations mostly remain unnoticed and are often protected by implausible explanations. In the long run, persistent rationalisation makes malpractices a norm. The present work describes the interventions applied by a consulting firm to bring behavioural integrity. The consulting firm found that socialisation, rationalisation and institutionalisation considerably influenced people’s behaviour at the workplace and normalised unethical behaviour of insurance agents. It architected the behaviour of salespeople by specifically designed interventions through self-control mechanism and nudges. These interventions developed integrity in employees and reduced the number of cautions, warnings and terminations.

scholarly journals Optimal Dividend and Capital Injection Problem with Transaction Cost and Salvage Value: The Case of Excess-of-Loss Reinsurance Based on the Symmetry of Risk Information

Symmetry ◽  
2018 ◽  
Vol 10 (7) ◽  
pp. 276 ◽  
Author(s):  
Qingyou Yan ◽  
Le Yang ◽  
Tomas Baležentis ◽  
Dalia Streimikiene ◽  
Chao Qin
Keyword(s):  
Transaction Cost ◽  
Risk Information ◽  
Insurance Company ◽  
Optimal Control Strategy ◽  
Ruin Time ◽  
Discounted Cost ◽  
Capital Injection ◽  
Surplus Process ◽  
Optimal Dividend ◽  
A Company

This paper considers the optimal dividend and capital injection problem for an insurance company, which controls the risk exposure by both the excess-of-loss reinsurance and capital injection based on the symmetry of risk information. Besides the proportional transaction cost, we also incorporate the fixed transaction cost incurred by capital injection and the salvage value of a company at the ruin time in order to make the surplus process more realistic. The main goal is to maximize the expected sum of the discounted salvage value and the discounted cumulative dividends except for the discounted cost of capital injection until the ruin time. By considering whether there is capital injection in the surplus process, we construct two instances of suboptimal models and then solve for the corresponding solution in each model. Lastly, we consider the optimal control strategy for the general model without any restriction on the capital injection or the surplus process.

scholarly journals INCREASING THE COMPETITIVENESS OF INSURANCE COMPANY PRODUCTS AND SERVICES USING ECONOMIC AND MATHEMATICAL MODELING METHODS

2021 ◽  
Author(s):  
Mykhailo Demydenko ◽  
Ihor Pistunov
Keyword(s):  
Mathematical Model ◽  
Social Activity ◽  
Insurance Companies ◽  
Comprehensive System ◽  
Insurance Company ◽  
Competitive Advantages ◽  
Insurance Policy ◽  
Insurance Policies ◽  
The Impact

The competitiveness of an insurance company depends on the competitiveness of the products and services it introduces in the market. The competitive advantages of the insurance company are expressed in the attractiveness and competitiveness of insurance policies. An economic and mathematical model of increasing the competitiveness of the insurance company is proposed, which allows to calculate the integrated indicator of competitiveness of the insurance policy based on a comprehensive system of indicators characterizing the reliability of the insurance company, quality of its services, competitiveness, social activity. To analyze the impact of these indicators on the competitiveness of the insurance policy and identify areas for improving the efficiency and competitiveness of the insurance company. The competitiveness of an insurance company depends on the competitiveness of the products and services it introduces in the market. The assessment of the quality of insurance company services is compliance with the needs, requirements, and insurance interests of customers. This assessment is performed each time an individual client chooses to cooperate with an insurance company that meets his insurance interests and wishes. Therefore, the overall competitiveness of the enterprise depends on the competitiveness of products and services offered on the market. The competitive advantages of the insurance company are expressed in the attractiveness and competitiveness of insurance policies. The insurance market in recent years has shown consistently high growth, which makes it attractive for doing business. In these conditions, the task of modeling the activities of the insurance company in a highly competitive market environment becomes relevant. A mathematical model of increasing the competitiveness of the insurance company is proposed, which allows to calculate the integrated indicator of competitiveness of the insurance policy based on a comprehensive system of indicators characterizing the reliability of the insurance company, quality of its services, competitiveness, social activity. With the proposed model, insurance companies can objectively assess their weaknesses and strengths to ensure continuous growth and decent competition in a competitive market environment. The model allows you to select performance indicators and perform modeling and determine the consequences of changes in this indicator, analyze the impact of these indicators on the competitiveness of insurance policies and identify areas for improving the efficiency and competitiveness of the insurance company. By conducting such experiments, insurance companies can make more informed choices and decisions, analyze areas of competitiveness, and more efficiently allocate resources.

scholarly journals Insurance Services with Special Reference to Star Health and Allied Insurance Company Limited

2019 ◽  
Vol 8 (2S8) ◽  
pp. 486-489
Keyword(s):  
Health Insurance ◽  
Insurance Industry ◽  
Insurance Company ◽  
Related Factors ◽  
Insurance Policies ◽  
Current Health ◽  
Company Limited ◽  
Major Factors ◽  
And Control ◽  
Indian Insurance

Medical coverage is budgetary instrument with which individuals are shielded against catastrophic financial weight emerging from unforeseen disease or damage. Having a well working protection system ensures pooling of assets to cover dangers. The medical coverage segment in India is in a beginning stage and a mere 9% of the complete populace is secured under any plan of medical coverage since Health Insurance policies are administrations and henceforth elusive in nature. So there is no prompt shot of acknowledging the services whether fortunate or unfortunate. Indian Insurance Industry has encountered a swelling impact after globalization and the progression of the economy. After the financial advancement, the paradigm changed from focal arranging, direction and control to showcase driven improvement. The level of buying of medical coverage shifts from individual to individual. It relies on numerous variables. The elements can be classified into individual, social, financial, mental and friends related factors. On the off chance that the health insurance business wishes to pull its weight in forming this immense market, it needs to examine the major factors impacting the buy of medical coverage arrangements, With rivalry developing perpetually, insurers need to be in the nonstop procedure of item advancement concoct inventive approaches to contribute toward actualizing the administration's need of offering medical coverage to poor. The current health insurance projects required considerable changes to make them increasingly effective and socially helpful.

Developing Risk Skills: An Investigation of Business Risks and Controls at Prudential Insurance Company of America

2001 ◽  
Vol 16 (2) ◽  
pp. 291-313 ◽  
Author(s):  
Paul L. Walker ◽  
William G. Shenkir ◽  
C. Stephen Hunn
Keyword(s):  
Risk Assessment ◽  
Corporate Culture ◽  
Life Insurance ◽  
Control Environment ◽  
Insurance Company ◽  
Special Committee ◽  
Business Professionals ◽  
Poor Control ◽  
Assurance Services ◽  
A Company

The Prudential Insurance Company was involved in the largest life insurance churning scam of the 1980s and early 1990s. At the time, Prudential had weak business controls, and its corporate culture was characterized as ineffective and loose. However, this scandal is rooted in something deeper than a poor control environment. Prudential was a company facing several risks; many company decisions allowed these risks to have a dramatic impact on the company. As a result, its weak control environment came to the forefront, allowing the churning scam to reach its record levels. This case demonstrates the value of identifying and assessing risks in an organization. Further, the case demonstrates how to build control solutions to match the risks. Learning how to manage risks is a valuable skill for business professionals. In fact, the AICPA's Special Committee on Assurance Services (AICPA 1997), also known as the Elliott Committee, identified risk assessment as one of the emerging assurance services offered by CPAs.

Risk Analysis of ICT Assets

2019 ◽  
pp. 175-193
Author(s):  
Hamed H. Dadmarz
Keyword(s):  
Information Security ◽  
Risk Analysis ◽  
Human Resources ◽  
Business Owners ◽  
Insurance Company ◽  
Security Risk ◽  
Business Goals ◽  
Top Managers ◽  
Information Security Risk ◽  
Information Assets

Risk analysis is required in all companies to help the business owners or top managers make decisions about risk management strategy, which itself provides an organization with a roadmap for information and information infrastructure protection aligned to business goals and the organization's risk profile. This chapter identifies information assets including network, electricity, hardware, service, software, and human resources in the ICT department of a health insurance company and their relevant risks. To determine the risks, the level of confidentiality, level of integrity, level of availability, the likelihood of threat occurrence, and intensity of vulnerability have been assessed and rated. Assessment is done based on the opinions of 30 experts in the field of information security. According to the results, the highest information security risk is on the network.

Life

2020 ◽  
pp. 8-32
Author(s):  
Benjamin Wiggins
Keyword(s):  
Public Relations ◽  
Insurance Industry ◽  
Theoretical Work ◽  
Business Practices ◽  
Insurance Company ◽  
Company Policy ◽  
History Of ◽  
A Company ◽  
History Of Race

Chapter 1 focuses on the early history of race-based insurance. When the Newark-based Prudential Insurance Company of America incorporated in 1875, it revolutionized the American insurance industry by offering policies to the working class for an affordable three cents per week. What made the Prudential doubly unique was that the company insured not simply industrial laborers, but also African American laborers. The company was not in the progressive vanguard, though. Rather, the Northern upstart, in contrast to its Southern competitors, simply had not thought to craft a company policy to explicitly ban African Americans from purchasing life insurance. Just five years after becoming the first insurer to cover black lives, the Prudential began to charge differential, race-based premiums and commenced a public relations effort to defend its discriminatory practices. This foundational chapter traces how the theoretical work of scientific racism became embedded in the business practices of American insurers.

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