# claim_payment_no: Number of Partial Payments In SynthETIC: Synthetic Experience Tracking Insurance Claims

 claim_payment_no R Documentation

## Number of Partial Payments

### Description

Simulates and returns the number of partial payments required to settle each of the claims occurring in each of the periods.

### Usage

``````claim_payment_no(frequency_vector, claim_size_list, rfun, paramfun, ...)
``````

### Arguments

 `frequency_vector` a vector of claim frequencies for all the periods. `claim_size_list` list of claim sizes. `rfun` optional alternative random sampling function; see Details for default. `paramfun` parameters for the random sampling function, as a function of `claim_size`; see Details. `...` other arguments/parameters to be passed onto `paramfun`, e.g. if going with the default sampling distribution, you can specify a `claim_size_benchmark_1` (below which claims are assumed to be settled with 1 or 2 payments) and `claim_size_benchmark_2` (below which claims are assumed to be settled with 2 or 3 payments).

### Details

Returns a list structure such that the `i`th component of the list gives the number of partial payments required to settle each of the claims that occurred in period `i`. It is assumed that at least one payment is required i.e. no claims are settled without any single cash payment.

Let `M` represent the number of partial payments associated with a particular claim. The default `simulate_no_pmt_function` is set up such that if `claim_size` `\le` `claim_size_benchmark_1`,

`Pr(M = 1) = Pr(M = 2) = 1/2;`

if `claim_size_benchmark_1` < `claim_size` `\le` `claim_size_benchmark_2`,

`Pr(M = 2) = 1/3, Pr(M = 3) = 2/3;`

if `claim_size` > `claim_size_benchmark_2` then `M` is geometric with minimum 4 and mean

`min(8, 4 + log(claim_size/claim_size_benchmark_2)).`

Alternative sampling distributions are supported through `rfun` (the random generation function) and `paramfun` (which returns the parameters of `rfun` as a function of `claim_size`). The `paramfun` should return the distribution parameters in a vector, e.g. for gamma distribution `paramfun` should return a value in the format of `c(shape = , scale = )`. If a `rfun` is specified without a `paramfun`, `SynthETIC` will try to proceed without parameterisation (i.e. directly calling `rfun` with `claim_size`), and if it fails, then return an error message.

### Examples

``````n_vector <- claim_frequency(I = 10)
# with default simulation function
no_payments <- claim_payment_no(n_vector, claim_size(n_vector))
no_payments[[1]] # number of payments for claims incurred in period 1

# modify the lower benchmark value
claim_payment_no(n_vector, claim_size(n_vector),
claim_size_benchmark_1 = 5000)
``````

SynthETIC documentation built on May 29, 2024, 8:47 a.m.