This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. Journals
  3. Journal of Economic Perspectives
  4. Spring 1992
  5. Controlling Automobile Insurance Costs

Journal of Economic Perspectives

ISSN 0895-3309 (Print) | ISSN 1944-7965 (Online)

Controlling Automobile Insurance Costs

  • J. David Cummins
  • Sharon Tennyson
Journal of Economic Perspectives
vol. 6, no. 2, Spring 1992
(pp. 95–115)
Download Full Text PDF
(Complimentary)

Abstract

We begin by providing an overview of the auto insurance system and the structure of the auto insurance market. We then turn to an analysis of the factors underlying the auto insurance price increases experienced in recent years. We find that the auto insurance inflation of the 1980s was caused primarily by increases in cost factors, especially inflation in the severity of personal injury claims. There is no persuasive evidence that increasing profit rates or expense loadings contributed to inflation in premiums. The paper concludes with recommendations for bringing costs under control.

Citation

Cummins, J. David, and Sharon Tennyson. 1992. "Controlling Automobile Insurance Costs." Journal of Economic Perspectives, 6 (2): 95–115. DOI: 10.1257/jep.6.2.95

JEL Classification

  • G22 Insurance; Insurance Companies
There are no comments for this article.
Login to Comment