When insurers or risk managers use frequency and severity to project the future, they use trending techniques that apply to the loss distributions known to them.Identify the most commonly used tool to predict future losses and claims based on the past.
A)Regression analysis
B)ANOVA
C)Factor analysis
D)Chi square testing
E)Analysis of covariance

Question

Quizplus · Accepted Answer

Regression analysis is the most commonly used tool for predicting future losses and claims based on past data. It helps in understanding the relationship between the dependent variable (future losses or claims) and one or more independent variables (factors affecting those losses or claims).

When Insurers or Risk Managers Use Frequency and Severity to Project