The Effect of a Suburban Driving Population on Urban Auto Insurance Premiums
研究反驳了按驾驶者对拥堵和事故频率的贡献分配汽车保险损失的提议，指出基于实际损失经验的传统方法更合理，并探讨了按贡献分配系统的复杂性和固有错误。
This study addresses one aspect of the issue regarding the allocation of losses to territorial rating groups. Specifically, the study refutes the proposal that losses should be allocated to a rating group on the basis of its drivers' contribution to congestion and accident frequency rather than the usual method of allocation on the basis of the group's actual loss experience. Further, some of the complexities and inherent errors of a system that allocates losses on the basis of contribution to congestion are explored. In conducting the study, claim data are used in conjunction with two traffic congestion/accident frequency models. Highly congested urban areas generally have larger auto insurance losses per insured than their less congested suburban counterparts. Auto insurance premiums tend to reflect this differential loss pattern by pairing higher priced rating territories with higher loss urban areas. Some critics of the auto insurance industry (notably former Commissioner Stone of Massachusetts) have contended that such pricing is unfair to urban dwellers [ 1]. They have supported their contentions by arguing that accident frequency is affected by congestion and that increased congestion is caused by nonurban drivers commuting into urban areas. The auto insurance industry response to the criticism has been that the pricing mechanism already accounts for the involvement of nonurban drivers in urban accidents. The mechanism which assigns losses to the garaging location of the at-fault vehicles charges nonurban drivers for those accidents they cause in the urban area. This procedure allegedly fails to account adequately for the effect of increased congestion within urban areas. For example, even if two urban drivers collide, the critics contend that the fault (causative factor) is the increased traffic density created by an influx of nonurban cars. The congestion (density) argument has proven to be a difficult criticism for the auto insurance industry to refute using traditional approaches. Moreover, two studies seemingly corroborated the argument [2 and 3]. The study Mark D. Brissman is an Assistant Research Administrator in the Research Department of State Farm Mutual Automobile Insurance Company. He holds B.S. degrees in Mathematics and Biology and an M.S. in Industrial Administration from Purdue University. Mr. Brissman also holds the CPCU designation. The author is indebted to the editor of the Journal, two anonymous Journal referees, and the author's professional colleagues for their assistance in this project.