Risk measuring model on public liability fire and empirical study in China

Public fire insurance has recently appeared in China. The basis for calculating the premium is the accurate measurement of Publicliability risk in fire. The generalized linear model (GLM) is widely used for measuring this risk in practice, but the GLM often cannot be satisfied, especially in fat-tailed distribution. A nonparametric Gaussian kernel linear model used to improve the GLM is applied to measure publicliability risk in fire, yielding a favorable effect. Results show three major risk factors that were measured precisely - the nature of the industry, the scale of public places and the level of fire precaution.