Optimal premium pricing strategies for nonlife products in competitive insurance markets

Non-life insurance pricing depends on different costs including claim and business acquisition costs, management expenses and other parameters such as margin for fluctuations in claims experience, expected profits etc. Nevertheless, in a competitive insurance market environment, company's premium should respond to changes in the level of premiums being offered by competitors. In this thesis, two major issues are being investigated. Primarily, it is explored how a company's optimal strategy can be determined in a competitive market and secondly a connection between this strategy and market's competition is established. More specifically, two functional equations for the volume of business are proposed. In the first place, the volume of business function is related to the past year's experience, the average premium of the market, the company's premium and a stochastic disturbance. Thus, an optimal premium strategy which maximizes the total expected linear discounted utility of company's wealth over a finite time horizon is defined analytically and endogenously. In the second place, the volume of business function is enriched with company's reputation, for the first time according to the author's knowledge. Moreover, the premium elasticity and reputation elasticity of the volume of business are taking into consideration. Thus, an optimal premium strategy which maximizes the total expected linear discounted utility of company's wealth over a finite time horizon is calculated and for some special cases analytical solutions are presented. Furthermore, an upper bound or a minimum premium excess strategy is found for a company with positive reputation and positive premium elasticity of the volume of business. Thirdly, the calculation of a fair premium in a competitive market is discussed. A nonlinear premium-reserve (P-R) model is presented and the premium is derived by minimizing a quadratic performance criterion concerns the present value of the reserve. The reserve is a stochastic equation, which includes an additive random nonlinear function of the state, premium and not necessarily Gaussian noise which is independently distributed in time, provided only that the mean value and the covariance of the random function is zero and a quadratic function of the state, premium and other parameters, respectively. In this quadratic representation of the covariance function, new parameters are implemented and enriched further the previous linear models, such as the income insurance elasticity of demand, the number of insured and the inflation in addition to the company's reputation. Interestingly, for the very first time, the derived optimal premium in a competitive market environment is also depended on the company's reserve among the other parameters. In each chapter numerical applications show the applicability of the proposed models and their results are further explained and analyzed. Finally, suggestions for further research and summary of the conclusions complete the thesis

Optimal strategies for a non-linear premium-reserve model in a competitive insurance market

AbstractThe calculation of a fair premium is always a challenging topic in the real-world insurance applications. In this paper, a non-linear premium-reserve (P-R) model is presented and the premium is derived by minimising a quadratic performance criterion. The reserve is a stochastic equation, which includes an additive random non-linear function of the state, premium and not necessarily Gaussian noise, which is, however, independently distributed in time, provided only that the mean value and the covariance of the random function is 0 and a quadratic function of the state, premium and other parameters, respectively. In this quadratic representation of the covariance function, new parameters are implemented and enriched further by the previous linear models, such as the income insurance elasticity of demand, the number of insured and the inflation in addition to the company’s reputation. The quadratic utility function concerns the present value of the reserve. Interestingly, for the very first time, the derived optimal premium in a competitive market environment is also dependent on the company’s reserve among the other parameters. Finally, a numerical application illustrates the main findings of the paper.</jats:p

Is nonangiogenesis a novel pathway for cancer progression? A study using 3-dimensional tumour reconstructions

The nonangiogenic lung tumour is characterized by neoplastic cells co-opting the pre-existent vasculature and filling the alveoli space. 3-Dimensional reconstruction of the tumour reveals that this particular tumour progresses without neovascularization and there is no major destruction of the lung's architectural integrity

Temperature differences are associated with malignancy on lung lesions: a clinical study

BACKGROUND: Although new endoscopic techniques can enhance the ability to detect a suspicious lung lesion, the primary diagnosis still depends on subjective visual assessment. We evaluated whether thermal heterogeneity of solid tumors, in bronchial epithelium, constitutes an additional marker for the diagnosis of benign and malignant lesions. METHODS: A new method, developed in our institute, is introduced in order to detect temperature in human pulmonary epithelium, in vivo. This method is based on a thermography catheter, which passes the biopsy channel of the fiber optic bronchoscope. We calculated the temperature differences (ΔT) between the lesion and a normal bronchial epithelium area on 22 lesions of 20 subjects, 50 – 65 years old. RESULTS: Eleven lesions were benign and 11 were malignant, according to the biopsy histology followed the thermography procedure. We found significant differences of ÄT between patients with benign and malignant tumor (0.71 ± 0.6 vs. 1.23 ± 0.4°C, p < 0.05). Logistic regression analysis showed that 1-Celsius degree differences between normal tissue and suspicious lesion six-fold the probability of malignancy (odds ratio = 6.18, 95% CI 0.89 – 42.7). Also, ΔT values greater than 1.05°C, constitutes a crucial point for the discrimination of malignancy, in bronchial epithelium, with sensitivity (64%) and specificity (91%). CONCLUSION: These findings suggest that the calculated ΔT between normal tissue and a neoplastic area could be a useful criterion for the diagnosis of malignancy in tumors of lung lesions

Vascular phenotype in angiogenic and non-angiogenic lung non-small cell carcinomas

We have previously described a group of non-small cell lung carcinomas without morphological evidence of neo-angiogenesis. In these tumours neoplastic cells fill up the alveoli and the only vessels present appear to belong to the trapped alveolar septa. In the present study we have characterised the phenotype of the vessels present in these non-angiogenic tumours, in normal lung and in angiogenic non-small cell lung carcinomas. The vessels, identified by the expression of CD31, were scored as mature when expressing the epitope LH39 in the basal membrane and as newly formed when expressing αVβ3 on the endothelial cells and/or lacking LH39 expression. In the nine putative non-angiogenic cases examined, the vascular phenotype of all the vessels was the same as that of alveolar vessels in normal lung: LH39 positive and αVβ3 variable or negative. Instead in 104 angiogenic tumours examined, only a minority of vessels (mean 13.1%; range 0–60%) expressed LH39, while αVβ3 (in 45 cases) was strongly expressed on many vessels (mean 55.5%; range 5–90%). We conclude that in putative non-angiogenic tumours the vascular phenotype is that of normal vessels and there is no neo-angiogenesis. This type of cancer may be resistant to some anti-angiogenic therapy and different strategies need to be developed

Consensus guidelines for the use and interpretation of angiogenesis assays

The formation of new blood vessels, or angiogenesis, is a complex process that plays important roles in growth and development, tissue and organ regeneration, as well as numerous pathological conditions. Angiogenesis undergoes multiple discrete steps that can be individually evaluated and quantified by a large number of bioassays. These independent assessments hold advantages but also have limitations. This article describes in vivo, ex vivo, and in vitro bioassays that are available for the evaluation of angiogenesis and highlights critical aspects that are relevant for their execution and proper interpretation. As such, this collaborative work is the first edition of consensus guidelines on angiogenesis bioassays to serve for current and future reference

Vascular patterns in reactive lymphoid tissue and in non-Hodgkin's lymphoma.

The few studies published on angiogenesis in lymphoma have raised the question of whether or not microvessel density (MVD) is associated with more aggressive disease and have reported the observation that in follicular lymphomas, vessels are mature rather than immature. We investigated MVD and the vascular phenotype within follicular or diffuse large B-cell lymphomas, reactive nodes and tonsils. Vascular phenotype was defined by the expression or loss of reactivity to the antibody LH39 (detecting the LH39 laminin epitope of the basement membrane in mature vessels) and by detection of alpha V beta 3 (expressed on immature vessels). In reactive nodes and in follicular lymphomas, MVD was higher in the paracortex than in germinal centres or in neoplastic follicles. However, in neoplastic follicles an increase in alpha V beta 3-positive endothelium suggested the activation of an angiogenic pathway different from that present in the reactive follicles. In large B-cell lymphomas, MVD was higher than in reactive and neoplastic follicles but lower than in the reactive paracortex. The number of immature vessels (LH39 negative) and of alpha V beta 3-positive vessels was higher than in reactive lymph nodes and follicular lymphoma suggesting that a switch to a different angiogenic pathway has occurred. Finally, we have demonstrated that within reactive and neoplastic follicles vascular regression is occurring, perhaps constraining the growth of reactive follicles alongside other phenomena such as apoptosis. Vascular regression was previously believed to occur in adults only in ovarian and endometrial tissue. We conclude that different types of angiogenesis are present in follicular lymphomas and large B-cell lymphomas. This has implications for possible future therapies