For the future probabilistic models to be built, several input parameters should be considered:
We have complex scientific actuarial models for predicting the number of claims and value of each claim based on which we are building the future model.
Based on the input data, hundredths of simulations are made and the results are depicted on a graph. Those simulations are used to generate a probabilistic environment in which the margin of error can be delivered in the desired ranges.
After the simulations are run and the predictions about the future data are plugged into the software, ORM presents us with the best option regarding the selected risk preference. There is also an option for several treaties to be inputted, so the software can make predictions based on future events which would be best tailored for the insurance company needs. The software allows the company to enter different inputs and to make analysis for the future based on them. This powerful tool gives very important insight to the management, simplifies the process of choosing reinsurance treaties and allows the company management to focus on other areas of the business.