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October  2018, 14(4): 1545-1564. doi: 10.3934/jimo.2018020

Analysis of a dynamic premium strategy: From theoretical and marketing perspectives

 1 Department of Mathematics and Statistics, Hang Seng Management College, Hang Shin Link, Siu Lek Yuen, Shatin, N.T., Hong Kong, China 2 China Institute for Actuarial Science, Central University of Finance and Economics, China

* Corresponding author: Fangda Liu

Received  February 2017 Revised  June 2017 Published  October 2018 Early access  January 2018

Premium rate for an insurance policy is often reviewed and updated periodically according to past claim experience in real-life. In this paper, a dynamic premium strategy that depends on the past claim experience is proposed under the discrete-time risk model. The Gerber-Shiu function is analyzed under this model. The marketing implications of the dynamic premium strategy will also be discussed.

Citation: Wing Yan Lee, Fangda Liu. Analysis of a dynamic premium strategy: From theoretical and marketing perspectives. Journal of Industrial and Management Optimization, 2018, 14 (4) : 1545-1564. doi: 10.3934/jimo.2018020
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Strategy 1 ($c_{1} = 4$ and $c_{2} = 6$) vs Strategy 2 ($c = 4$) ($\eta_{1}$ denotes the starting premium)
Strategy 1 ($c_{1} = 4$ and $c_{2} = 6$) vs Strategy 2 ($c = 5$)
Strategy 1 ($c_{1} = 4$ and $c_{2} = 6$) vs Strategy 2 ($c = 4$)
Strategy 1 ($c_{1} = 4$ and $c_{2} = 6$) vs Strategy 2 ($c = 5$)
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