Should I Use That Rating Factor? A Philosophical Approach to an Old Problem

This paper is a collaboration between HMI, IAG and Gradient, and reflects our broader concern that new methods that use machine learning to influence risk predictions to determine insurance premiums won't be able to distinguish between risks the costs of which people should bear themselves, and those that should be redistributed across the broader population, and might also involve using data points that it is intrinsically wrong to use for this purpose.

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