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|Title:||The Effect of the Introduction of a» Pay Per Use «Option within motor TPL insurance||Authors:||Trappl, Stefan
|Keywords:||Insurance;Pay per Use;Pay as you Drive;Adverse Selection;Selection Effects||Issue Date:||2014||Publisher:||University of Warsaw, Faculty of Management||Source:||Journal of Banking and Financial Economics, 1(1), 73–87||Journal:||Journal of Banking and Financial Economics||Abstract:||In this paper the effects of the introduction of the so called “pay per use” -insurance products are examined. These products collect data of kilometers driven by policy holders. As a result of this data, policy holders can get a refund on the insurance-premium paid. Since there is a positive correlation between mileage and the risk of causing an accident the refund is granted to low-mileage drivers, so in theory the “pay per use” product is more attractive to low-mileage drivers than to long-distance drivers. The authors examine empirical evidence to find out whether or not it is mainly low-mileage-drivers who choose the “pay per use” product. Secondly, the authors examine whether there are other significant differences between characteristics of “pay per use” policy-holders and “traditional” policy- holders. Therefore a random sample of 4,000 car-insurance - clients (2,000 “pay per use” policy- holders and 2,000 “traditional” policy-holders) is reviewed. In addition the effects of the introduction of “pay per use” products are discussed, in case of a selection effect between low- and high -mileage drivers is observed.||URI:||http://hdl.handle.net/20.500.11790/563||ISSN:||2353-6845||DOI:||10.7172/2353-6845.jbfe.2014.1.5||Rights:||info:eu-repo/semantics/closedAccess|
|Appears in Collections:||Wirtschaft (mit Schwerpunkt Zentral-Osteuropa)|
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