Evan Zamir
Feb 9, 2022

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You can use the frequency x severity formula just make sure to account for the exposure in the frequency prediction. By definition the severity prediction assumes 1 claim count. There really is no need to use an offset in a severity model, since the gamma distribution is continuous anyway. In addition you could just go straight to a pure premium model by using a Tweedie loss function.

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Evan Zamir
Evan Zamir

Written by Evan Zamir

Data Scientist. San Francisco.

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