set_parameters: Set Packagewise Global Parameters for the Claims Simulator

In SynthETIC: Synthetic Experience Tracking Insurance Claims

Set Packagewise Global Parameters for the Claims Simulator

Description

Sets ref_claim and time_unit parameters for all the simulation functions within the SynthETIC package.

Usage

set_parameters(ref_claim = 2e+05, time_unit = 1/4)

Arguments

ref_claim	a reference value for the claim sizes (default 200000).
time_unit	time unit to work with, given as a fraction of a year; default calendar quarters (1/4).

Details

Those variables will be available to multiple functions in this package, but are kept local to the package environment (i.e. not accessible from the global environment). To extract the current values of the variables, use return_parameters.

We introduce the reference value ref_claim partly as a measure of the monetary unit and/or overall claims experience. The default distributional assumptions were set up with an Australian Auto Liability portfolio in mind. ref_claim then allows users to easily simulate a synthetic portfolio with similar claim pattern but in a different currency, for example. We also remark that users can alternatively choose to interpret ref_claim as a monetary unit. For example, one can set ref_claim <- 1000 and think of all amounts in terms of $1,000. However, in this case the default simulation functions will not work and users will need to supply their own set of functions and set the values as multiples of ref_claim rather than fractions as in the default setting.

We also require the user to input a time_unit (which should be given as a fraction of year), so that the default input parameters apply to contexts where the time units are no longer in quarters. In the default setting we have a time_unit of 1/4 i.e. we work with calendar quarters.

The default input parameters will update automatically with the choice of the two variables ref_claim and time_unit, which ensures that the simulator produce sensible results in contexts other than the default setting. We remark that both ref_claim and time_unit only affect the default simulation functions, and users can also choose to set up their own modelling assumptions for any of the modules to match their experiences even better. In the latter case, it is the responsibility of the user to ensure that their input parameters are compatible with their time units and claims experience. For example, if the time units are quarters, then claim occurrence rates must be quarterly.

See Also

See the vignette for this package for a full list of functions impacted by those two variables.

Examples

set_parameters(ref_claim = 200000, time_unit = 1/12) # monthly reserving

SynthETIC documentation built on Sept. 3, 2023, 5:06 p.m.