Does private information affect the insurance risk?: evidence from the automobile insurance market

Sara Arvidsson

We empirically investigate the effect of policyholders’ private information of risky traffic behavior on automobile insurance coverage and ex post risk. We combine our insurance company’s information with private information data that is not accessible to the insurance company. We show that being unable to reject the null of zero correlation is not necessarily consistent with symmetric information in the automobile insurance market. Our results are twofold: In contrast to much of the previous work we find a positive significant correlation for three groups of policyholders, consistent with the adverse selection prediction. We furthermore find that private information about risky traffic behavior increases ex post risk while it both increases and decreases the demand for extensive insurance. This supports our hypothesis that adverse and propitious is present simultaneously in this market.



Cost Benefit Analysis (CBA) workshop in Stockholm

An open seminar and workshop in Stockholm will be held on 25-26 April 2018. The workshop deals with the use of CBA as a basis for decision-making in the public sector. The workshop is organized by, among others, Professor Jan-Eric Nilsson, VTI.



Ulf Sandberg has been presented with the TTI Lifetime Achievement Award 2018

VTI’s Senior Research Leader Ulf Sandberg has been presented with the TTI Lifetime Achievement Award 2018 for his work on research into tyres and road surface.


Steps need to be taken to increase traffic safety of automated cars

Several steps are necessary to ensure that automated and connected cars will lead to increased traffic safety – everything from ensuring that technology takes vulnerable road users into account, to new forms of driver training. This has emerged in a position...


FALCON examines challenges in the transport sector

VTI is one of several important partners in the major FALCON project*, whose purpose is to create knowledge and insight regarding the transport sector. In an initial subproject, VTI has produced a manual on transport, logistics and multimodality.


VTI joined research cooperation in China

In December 2017 VTI became a member of China-Sweden Research Centre for Traffic Safety (CTS).


Swedish German research collaboration on Electric Road Systems

The project “Swedish-German research collaboration on Electric Road Systems” (CollERS) has now officially started. The goal of the project is to increase the common knowledge around Electric Road Systems by cooperation between Germany and Sweden and to...


Electric Road Systems Conference 2018

After a successful first conference in June 2017, the Swedish research and innovation platform for electric roads is arranging the second dedicated International Conference on Electric Road Systems (ERS) June 13th and 14th 2018.