(1) An actuarial term describing the degree of accuracy in forecasting future
events based on statistical reporting of past events.
(2) The weight assigned
or assignable to observed data in contrast to that assigned to an external or
broader-based set of data. Credibility is used to provide a measure of the relative
predictive value of the data being reviewed. Weights can be determined through
detailed formulas or by judgment. The weight assigned should generally increase
with the number of exposure bases in the observed data and should decrease
with higher levels of variability in the observed data.