Overview
Once a claim has occurred, the next step is often to model the distribution of claims awards. That is, a model for how much money the claim pays out.
Distributions
- Beta Distribution - the beta distribution is a distibution over a fixed rannge, {% [a, b] %}. It can be specified by specifying the mean and variance.
- Lognormal Distribution - a distribution bounded below by zero and unbounded to the upside. Can be specified by a mean and variance.