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Outline

Soft Computing Applications

2016, Advances in Intelligent Systems and Computing

https://doi.org/10.1007/978-3-319-18296-4

Abstract

The purpose of this article is to provide an overview of soft computing applications in actuarial science. Soft computing (SC) refers to modes of computing in which precision is traded for tractability, robustness and ease of implementation. For the most part, SC encompasses the technologies of fuzzy logic, genetic algorithms, and neural networks, and it has emerged as an effective tool for dealing with control, modeling, and decision problems in complex systems. The paper ends with a general comment on the study. arc35_11_01a

FAQs

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What findings are reported about neural networks in insurance classification tasks?add

The paper reveals that a multilayer perceptron network excelled in classifying life insurance applicants, outperforming traditional methods by identifying key inputs used in classifications. Specifically, the neural network demonstrated effective learning and reinforced classification accuracy.

How does fuzzy logic impact pricing in group health insurance?add

Research indicates that fuzzy logic can enhance pricing decisions by incorporating vague objectives alongside statistical data, resulting in dynamic rate adjustments. For instance, Young's model utilized fuzzy constraints to better reflect ancillary factors in pricing strategies.

What evidence supports genetic algorithms in optimizing insurance product competitiveness?add

Tan's 1997 study employed genetic algorithms with Monte Carlo simulations to define profitability-risk-competitiveness frontiers, yielding optimal asset allocations. This framework facilitated strategic positioning of insurance products based on comprehensive risk assessments.

What is the role of soft computing in predicting insurer insolvency?add

The study demonstrates that neural networks optimized by genetic algorithms outperformed traditional models in predicting insurance company bankruptcy, highlighting superior accuracy and robustness. Results showcased significant predictive capabilities, particularly two years prior to insolvency.

Which applications of soft computing address mortality and morbidity prediction?add

Neural networks have been applied to predict in-hospital complications and mortality rates in acute myocardial infarction patients, analyzing 20,873 cases from 1990-1993. Their findings indicated successful predictions for specific complications like death and congestive heart failure.

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