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900 Willingness to pay for innovative vehicle insurance schemes
  1. George Yannis,
  2. Dimitrios I Tselentis,
  3. Emmanouil Konstantinopoulos
  1. National Technical University of Athens Department of Transportation Planning and Engineering 5, Iroon Polytechniou Str., Zografou Campus, GR-15773 Athens, Greece


Background The objective of this research is to investigate Greek drivers willingness to pay for innovative vehicle insurance schemes such as Pay-as-you-drive (PAYD) and Pay-how-you-drive (PHYD) schemes. Current technological advances, enable to collect high resolution driver behaviour data easier and more accurately using technologies such as smartphones, On-Board Diagnostics (OBD) systems etc. and use them to monitor, analyse and evaluate each individual driver’s behaviour. PAYD scheme is based on assessing driver’s level of exposure to traffic risk while PHYD is based on driver behaviour indicators such as speeding, acceleration etc. The implementation of this policy has shown a significant impact on driver’s behaviour and as a result, this measurement is a matter of great importance for traffic safety.

Methods Within this research, a stated-preference survey is designed and administered in a questionnaire form both paper-based and online. The questionnaire is comprised of four sections including a general driving information, a driving behaviour information, a new innovative insurance policy scenario and a demographic characteristics section. At the third section, respondents are given several scenarios to choose between the standard and the new insurance policy in order to measure the sensitivity of their choice based on some factors such as the variation of mileage, the average speed and the annual insurance cost. Subsequently, a discrete choice model was developed to analyse data collected during this experiment.

Results indicate a strong correlation between policy choice and annual cost variation.

Conclusions Willingness to switch to a new innovative policy was found statistically significant especially for a cost reduction of 20%. Finally, mileage and average speed variation was found to affect people’s choice less than the innovative policy’s cost but still statistically significant.

  • Pay-as-you-drive
  • Pay-how-you-drive
  • insurance schemes
  • driver behaviour

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