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Propitious selectio...
Propitious selection in the vehicle insurance market
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- Arvidsson, Sara (författare)
- Statens väg- och transportforskningsinstitut,Transportekonomi Borlänge, TEK-B
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(creator_code:org_t)
- Borlänge : Statens väg- och transportforskningsinstitut, 2010
- Engelska 25 s.
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Serie: Working papers in transport economics ; 2010:2
- Relaterad länk:
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https://vti.diva-por... (primary) (Raw object)
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visa fler...
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https://urn.kb.se/re...
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Abstract
Ämnesord
Stäng
- By combining Contract Theory and vehicle positioning techniques, insurance companies can replace some of the proxies for risk by actual traffic behavior when pricing the premium. A mechanism design model is used to illustrate that Usage Based Insurance (UBI) can separate risks in terms of driving behavior. This makes it possible to reward safe driving habits since the pricing scheme better reflects the accident risk. The conclusion is that UBI provides an actuarially fair premium for the insuree. It is further an efficient instrument to separate risks for the insurer since it reduces the information asymmetries highlighted in this paper.
Ämnesord
- SAMHÄLLSVETENSKAP -- Ekonomi och näringsliv -- Nationalekonomi (hsv//swe)
- SOCIAL SCIENCES -- Economics and Business -- Economics (hsv//eng)
Nyckelord
- Insurance
- Car
- Risk
- Risk taking
- Driver
- Mathematical model
- Road: Accident costs
- Road: Accident costs
Publikations- och innehållstyp
- vet (ämneskategori)
- rap (ämneskategori)