Design And Pricing Of Usage-Based Insurance Product

As one of the most important types of property insurance,auto insurance accounts for a large proportion of premium income.However,the traditional auto insurance pricing is unreasonable and has been criticized for a long time.As a result,the auto insurance market is facing large-scale losses and consumer dissatisfaction.With the advancement of China's commercial car fare reform and the development of big data such as connected car data,a type of auto insurance(UBI)that is determined based on driving behavior has begun to attract attention,becoming the next hotspot in the auto insurance market.Based on this,this article explores the design and pricing of auto insurance products based on driving behavior.By analyzing the relationship between driving behavior factors and driving risk,screening factors that have a greater impact on driving risk are used as evaluation indicators.A hierarchical analysis-gray correlation method is used to construct a driving behavior evaluation model,and the obtained score is linked with the rate adjustment coefficient.Link to get the rate adjustment coefficient,and then calculate the premium according to the basic principles of China's commercial auto insurance rate determination,to achieve a more fair and reasonable accurate differential dynamic premium determination.The main research conclusions and results of this article include the following aspects:(1)The core essence of UBI is to incorporate driving behavior factors into the determination of premiums.Compared with traditional auto insurance,UBI has the advantage of more reasonable pricing and can Solve the problem of high homogeneity of current auto insurance products and reduce moral hazard.(2)Although the development of China's UBI is at the initial stage of exploration,there are many factors driving its development.At present,China has the conditions for UBI to be listed,both in terms of technology and policies,and it can be used by society,insurance companies and consumers.All bring benefits.The demand for UBI from all walks of life has been prominent.UBI has a large market space and is expected to reduce the underwriting risk currently facing the auto insurance market.(3)Empirical and validity test of the driving behavior scoring model constructed in this paper by selecting actual driving behavior and risk situation data,the results show that the driving score obtained from driving behavior has a significant negative relationship with the number of risks.This shows that the driving behavior score can effectively reflect the driver's driving safety level.The dynamic premiums finally calculated through the rate determination model constructed in this paper are obviously different.Drivers with different driving habits need to pay different premiums.Differentiated dynamic premiums are realized.