From the course: Excel for Banking Professionals
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Scenario analysis with Excel - Microsoft Excel Tutorial
From the course: Excel for Banking Professionals
Scenario analysis with Excel
- [Instructor] For insurance companies, the name of the game really is controlling your losses while making sure that you're collecting enough in premiums to overcome those losses when they come up. Excel can help you with this. I'm in the 0404 begin Excel file. So we've got here as a set of policy holders, their coverage amounts and then three different risk factors. And so I want to go through and calculate an actuarially fair premium for each of these different policy holders and then decide whether or not they're a desirable customer based on that. Okay. So, what I'm going to do is apply the risk factors that we see here with output that we might get from something like a regression analysis. It's easy to critique regressions and say well, this is a simplified model and do we know how well it represents reality. But in practical terms regressions are, assuming we've got the right risk factors in our model. One of…
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