Answer :
Answer:
Forecasting is a style of decision making process, used by organization to help in planning, budgeting, and estimating future growth and expenses of the organization. In other way, forecasting is a process of predicting a future outcome, using past and present outcomes.
I work at AXA Insurance company, were business forecasting is a key to the companies business. Forecasting is very important to my company because we use it to ascertain risk in insuring a property, and give insurance rate to the value of the property to be insured.
For example, in our fire and burglary insurance to a property,(fire and Burglary is an insurance against fire damage or theift to a property). Through forecasting we can be able to determine the risk involved in insuring a particular property against fire or burglary, because forecasting will tell us, how many of those properties that has been insured has come for a claim, through that we can determine the risk of insuring such property and the rate that will be applied to the value of that property when purchasing a premium(the money paid to an insurance company to insure your property or assure your life). With this forecasting it will be easier for the company to determine which property to insure and which rate should be applied to the value of such property, this will help the company to be strategic in choosing a preferably business and how the business should be done.
Another example is choosing an insurance policy that will be available in some geographical areas ( insurance policy are those insurance packages that binds an agreement between the insurance company and the insured person or property). Through forecasting the company has been able to evaluate all the insurance policy and decide where some policy will not apply. For instance we don't insure day-to-day commercial buses in Nigeria because of bad road networks, and poor maintenance of traffic lights, so accidental damage records with commercial buses are high, which has increased the rate claims are been paid, but for some countries like U.S where the road networks are well designed and traffic lights are maintained, we insure day-to-day commercial buses, because accidental damage records with those buses are low. So forecasting has help us to evaluate the claims that will be paid if we continue insuring those commercial buses in Nigeria, and how it will affect our business.
Forecasting is a key in planning business strategy, because it helps to tell you the Odds in doing a particular business. According to research, people who are good in forecasting, win more money from betting games, because it gives them the possibilities of predicting the outcome of an event.