Naslov (eng)

AN OVERVIEW OF THE DISTRIBUTIONS OF CLAIMS USED IN NON-LIFE INSURANCE THAT CONFORM TO BENFORD'S LAW

Autor

Stanojević, Jelena
Rajić, Vesna

Opis (eng)

Abstract: Benford's law, known as the law of the first digit, is used as a basic method to identify possible manipulation, or errors dеtection, in a large data set. Namely, according to that law, the first digits of the corresponding data set appear with a frequency determined according to the decreasing logarithmic law, which is contrary to the intuition about their uniform appearance. Thus, the number 1 appears in approximately 30% of the cases as the first digit, while the number 9 appears in 4.58% of cases. The subject of the paper is an overview of distributions that conform to Benford's law, which is confirmed both theoretically (by proving the theorems) and empirically (by conducting simulations). The goal of the paper is to determine the distribution that best fits the data on non-life insurance claims and then to examine the agreement with Benford's law using statistical tests applied in the literature. The main result of the paper is to determine the agreement or disagreement of the observed data set with Benford's law, thus providing an answer to the question about their possible manipulation and a possible proposal for a deeper analysis of individual numbers.

Jezik

engleski

Datum

2024

Licenca

Ovo delo je licencirano pod uslovima licence
Creative Commons CC BY-NC-SA 4.0 - Creative Commons Autorstvo - Nekomercijalno - Deliti pod istim uslovima 4.0 International License.

http://creativecommons.org/licenses/by-nc-sa/4.0/legalcode

Predmet

Key words: Benford's law, manipulation, Benford's law tests, simulations, non-life insurance

Deo kolekcije (1)

o:28218

Ekonomski fakultet