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A New Model for Usage-based Insurance in Order to Increase Road Safety

Sahebi, Sina | 2019

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  1. Type of Document: Ph.D. Dissertation
  2. Language: Farsi
  3. Document No: 52017 (09)
  4. University: Sharif University of Technology
  5. Department: Civil Engineering
  6. Advisor(s): Nassiri, Habibollah
  7. Abstract:
  8. The lack of road safety imposes heavy costs on society. The cost of treatment, disability, travel time and mental disorders are examples of costs caused by unsafe roads in a country. One of the most effective manners to improve road safety over the last decade is to use safe driving incentives and in particular usage-based insurance. Usage-based insurance reduces road accidents by internalizing the cost of driving violations and the cost of vehicle usage.Risky behaviors and driving violations, especially speed limits violations, have a significant effect on increasing unsafe road traffics. Accordingly, in this Ph.D. dissertation, a new scheme of usage-based insurance was introduced to reduce speed violations. In addition to proposing the new scheme of usage-based insurance, the effects of the proposed scheme on road safety have been investigated. In the proposed usage-based insurance scheme, the connected vehicle system is used as a probe device. In order to measure the effects of the proposed model on road traffic safety, it is necessary to measure the acceptance rate of usage-based insurance and calculate the accident risk of drivers. In order to answer the questions raised in this study, statistical models including the adoption model of usage-based insurance scheme, driver accident involvement model, and accidents loss distribution model have been used.Concerns about privacy, age, and the number of speed violations are the most important variables affecting the acceptance of the proposed scheme. The mileage, age, and the number of speed violations fines were found to be significant in the driver accident involvement model. The lognormal distribution function showed the best fit for accident damage data, among the proposed distributions in the literature.The results showed that if the proposed model of usage-based insurance includes an annual rental payment of about 20% of the cost of installing a connected vehicle system, then it could be expected that direct costs resulting from accidents will be compensated for less than five years. In this way, in the proposed model, in addition to reducing road accidents in the country, insurance companies will regain their initial investment, as institutions that pay compensation for direct accident costs. However, if the topic is viewed from the government's perspective, it can be expected that higher incentive levels, which will lead to greater acceptance of this technology and its penetration rate, can also be effective. The government incurs direct and indirect costs from traffic accidents. Given the government's higher revenue from accident reduction, the government's entry into the plan will lead to a sooner break-even point
  9. Keywords:
  10. Usage-Based Insurance ; Probing Device ; Driver Accident Involvement Model ; Bayesian Method ; Uncertainty

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