Improvement Of No Claim Discount System In Automobile Insurance

Automobile insurance occupies a large proportion of the property insurance.The situation of the automobile insurance's business has a direct impact on profits of property insurance company and the development of the market in chinese property insurance.It is a major insurance in the modern insurance industry.whether it is in thedeveloped Western countries or in China,auto insurance occupy an important position in the whole property insurance. Automobileinsurance Bonus-Malus System(referred to BMS) is widely used in countries around the world,which determine their renewal premium based on the driver's historical claims records.In China, the insurers have also developed their Bonus - Malus System or NCD System (No Claim Disco-unt System, referred to as NCD system).NCD system does not only have a lot of advantages but also have many shortcomings. Just as how to improve the fitting accuracy of the loss of data;how to introduce the claim to NCD;Now the NCD systems are assumed in a closed market environment,but in fact we are faced with the open environment;A complete information platform has not been established in the industry.The article is totally divided into five parts.I intends to use the insurance,automobile insurance actuarial science, mathematics, statistics and other disciplines to analyze NCD system and improve and make the empirical analysis of the NCD system.(the empirical datas come from the vehicle claims datas of a property insurance company in southwest of China during the year 2008).Chapter I,foreword.It focuses on the purpose and significance of the study,the development trend of domestic and foreign researches, research ideas,research methods,and the innovation and inadequate of studiesChapterâ…¡,the base of NCD system.Firstly,the general principles and methods of the property insurance rates are introduced;Secondly the basic mathematical tools used in the NCD system are introduce. Chapter III, the optimal single-factor NCD system--based on the claim frequency of the NCD system.Firstly this chapter introduces several commonly used distribution model of the claim frequency.Through the empirical analysis,good models for fitting results are selected.Then the selected models are superposed,and come closer to a quasi-real results.Then the superimposition is proved to be a better model for fitting.In the third section-NCD systematic theoretical model based on Claimst, the article has examined the three main models; In the last part-the the application of the model of NCD based on the number of claims, we briefly analyze a basic application model.Chapter IV, the optimal two-factor NCD system-based on the sum of claims of NCD system.This chapter is a key point of this paper.Summed up the outcome of the existing literature, in the first section of this chapter, we introduce several commonly used distribution model of the sum of claims.Through the empirical analysis,good models for fitting results are selected.Then the selected models are superposed,and come closer to a quasi-real results.Then the superimposition is proved to fitt with better results.Then we focus on analysis of the two types of theoretical mode considered the sum of claims; In the last section of this chapter, we try to lead the sum of claims into the NCD systems,establish an application model based on the sum of claims and analyse it, including the transfer matrix, stable distribution, the determination of premium levels, etc. At last,we make an empirical analysis used the vehicle claims datas of a property insurance company in southwest of China during the year 2008.Chapter V,the improvements and recommendations for the model.This chapter is another focus of this article.In the first section of this chapter,we will analyze the limited distribution of NCD system in an open market,based on the given open environment. And we will establish the model and make an empirical analysis in an open market environment.In order to avoid the insured from the system, I propose to establish information-sharing platform of auto insurance,and point out the importance of the establishment of the platform.Innovations of this article is mainly manifested in:(1)Made empirical analysis running through the paper in the use ofthe vehicle claims datas of a property insurance company in southwest of China during the year 2008. (2)Established the model considered the sum of claims and made the empirical analysis.(3) The introduction of the open environment and the establishment of model and empirical analysis.