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1 result for “credibility”
Formulae (1)
Actuarial & Insurance
Advanced
Credibility Weighting
P
=
Z
x
ˉ
+
(
1
−
Z
)
μ
P = Z\bar{x} + (1-Z)\mu
P
=
Z
x
ˉ
+
(
1
−
Z
)
μ
Blend own experience with the wider average by a credibility factor.
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