Spring 2015 Q14 c)
What is the loss ratio approach from sample 1? And what is the GLM approach for sample 2? I was thinking of the sections called "Given net losses" for deductibles and "Given censored claims" for policy limits and their respective formulas as a solution to these issues but what would those methods be called and are they the same as this "loss ratio approach" and "GLM" approach?
Also, for the GLM approach, does this mean we are fitting a curve to our censored data?
Thank you
Comments
I'm not sure what the solution is referring to when they say "loss ratio approach". I would ignore sample answer 1 and instead use the "fitted curve" or "GLM" answer since several of the sample answers mentioned those.