Incorporating telematics information in motor insurance ratemaking: The role of mileage and driving habits

• Ana María Pérez Marín ^[1]
  1. [1] Universitat de Barcelona

     Universitat de Barcelona

     Barcelona, España

     
• Localización: Contributions to risk analysis: risk 2018 / coord. por José María Sarabia Alegría, Faustino Prieto Mendoza, Montserrat Guillén Estany, 2018, ISBN 978-84-9844-683-8, págs. 237-244
• Idioma: inglés
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• Resumen

  • Nowadays, the calculation of premium rates based on driver behaviour is a great opportunity for the insurance industry. In this paper, we show which is the effect of incorporating data collected from a GPS device regarding driving patterns in motor insurance ratemaking. We use a classical Poisson regression model that is updated with telematics information. We use real data from usage-based insurance policies. We conclude that the distance travelled by the driver and driving habits have a significant effect on the expected number of accidents and, therefore, on the cost of insurance coverage.