On Automobile Insurance Ratemaking

After the manuscript had been distributed to the participants of the Arnhem Colloquium , Mr. Bailey and Mr. Simon have kindly drawn my attention to some recent works on the problem. Thus Mr. Bailey presented a the May 1963 Meeting of the Casualty Actuarial Society a paper "Insurance Rates with Minimum Bias", where he recommended an estimation procedure identical with the "Heuristic Method" discussed below. In the discussion following on Mr. Bailey's paper, Mr. James R. Bergquist presented numerical results from the application of this method to the original material, which results agree completely with the table D below. However, some of the arguments and results of this paper are outside the scope of the short 1963 paper by Mr. Bailey and may have an interest of their own. LOB-Auto Physical Damage