Will claim history become a deprecated rating factor? An optimal...
With the popularity of Telematics and Self-driving, more and more rating
factors, such as mileage, route, driving behavior, etc., are introduced into
actuarial models. There are quite a few doubts and disputes on the rationality
and accuracy of the selection of rating variables, but it does not involve the
widely accepted historical claim records. Recently, Tesla Insurance released a
new generation of Safety Score-based insurance, irrespective of accident
history. Forward-looking experts and scholars began to discuss whether claim
history will disappear in the future auto insurance rate-making system.
Therefore, this paper proposes a new risk variable elimination method as well
as a real-time road risk model design framework and concludes that claim
history will be regarded as a "noise" factor and deprecated in the