October 2014
Intermediate to advanced
584 pages
22h 2m
English
Content preview from Pricing in General Insurance
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482 Pricing in General Insurance
It is possible to dene the width of the lter and therefore the degree of smoothing. This
must be chosen with care so as to bring into relief the features that we want to capture: if
the lter size (e.g. the number r in our example above) is too small, a lot of noise will be cap-
tured and the underlying trend will not appear clearly; on the other hand, an excessively
large lter size may drown those very trends that we are trying to capture.
Armed with these considerations, we can move into two dimensions, which is especially
relevant in the case of postcodes. Following IFoA (2010), we will look at two types of ...
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