An analysis of possible applications of fuzzy set theory to the actuarial credibility theory

In this work, we review the basic concepts of actuarial credibility theory from the point of view of introducing applications of the fuzzy set-theoretic method. We show how the concept of actuarial credibility can be modeled through the fuzzy set membership functions and how fuzzy set methods, especially fuzzy pattern recognition, can provide an alternative tool for estimating credibility.