• Corpus ID: 235293703

Pricing Algorithmic Insurance

@article{Bertsimas2021PricingAI,
  title={Pricing Algorithmic Insurance},
  author={Dimitris Bertsimas and Agni Orfanoudaki},
  journal={ArXiv},
  year={2021},
  volume={abs/2106.00839}
}
As machine learning algorithms start to get integrated into the decision-making process of companies and organizations, insurance products will be developed to protect their owners from risk. We introduce the concept of algorithmic insurance and present a quantitative framework to enable the pricing of the derived insurance contracts. We propose an optimization formulation to estimate the risk exposure and price for a binary classification model. Our approach outlines how properties of the… 

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