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Communicating Uncertainty
An Impossible Task??

Adam Troyer
Lockton Re

MAF - September 30, 2020

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Why communicate uncertainty?

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dilbert

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Insurance (and life!) is an uncertain business

NY Times article: Those Hurricane Maps Don't Mean What You Think They Mean

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Insurance (and life!) is an uncertain business

NY Times article: Those Hurricane Maps Don't Mean What You Think They Mean

Irma Track - Thursday

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Insurance (and life!) is an uncertain business

NY Times article: Those Hurricane Maps Don't Mean What You Think They Mean

Irma Track - Thursday

Irma Track - Actual

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Actuarial work is an uncertain business

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Our standards compel us

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Our standards compel us

ASOP 41 - Actuarial Communication

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Our standards compel us

ASOP 41 - Actuarial Communication

ASOP 43 - Unpaid Claim Estimates

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What can we learn from the academic research?

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How to apply?

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Forecasting the Presidential Election

Information, incentives, and goals in election forecasts

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Loss reserving example - model fit

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Loss reserving example - quantile dotplot

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Loss reserving example - CCDF plot

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Cat loss simulation example

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Conclusion

We should be thinking about how to best communicate uncertainty

We can learn from academic literature (e.g. HOPs, quantile dotplots, etc.)

We can use modern tools to make this easier (e.g. web, R/Python, etc.)

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atroyer@lockton.com

Slides: maf-uncertainty-viz.netlify.app/

Code:

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Why communicate uncertainty?

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