Good drivers pay less: A study of usage-based vehicle insurance models

Yiyang Bian, Chen Yang, J. Leon Zhao and Liang Liang

Transportation Research Part A: Policy and Practice, 2018, vol. 107, issue C, 20-34

Abstract: Usage-based insurance (UBI) has been attracting more and more attention; however, two open research questions are how behavioral data of drivers affects driving risk and how driver behavior should affect UBI pricing schemas. This paper proposes a driver risk classification model to evaluate the risk level of drivers based on in-car sensor data. A Behavior-centric Vehicle Insurance Pricing model (BVIP) and a vehicle premium calculation prototype are developed in this paper. Based on empirical data, our research results show that BVIP achieves better accuracy in terms of risk-level classification and the prototype achieves good performance in terms of effectiveness and usability.

Keywords: Usage-based insurance; Driving behavior; Driver risk-level classification; Behavior-centric vehicle insurance pricing (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (8)

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DOI: 10.1016/j.tra.2017.10.018

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