It may not be transparent to the consumers. But, these algorithms are designed by actuaries and everyone in the company understands how it works. You need to have an audit trail of how the premium is calculated.
But in deep learning algorithms, features and co-efficients are not determined by humans. In most cases, it cant even be understood by humans. Without this understanding, I highly doubt if they will be accepted in regulatory industries.
But in deep learning algorithms, features and co-efficients are not determined by humans. In most cases, it cant even be understood by humans. Without this understanding, I highly doubt if they will be accepted in regulatory industries.