Customers' Opinions on Incentive Based Insurance

Raimo Voutilainen, Lasse Koskinen

Abstract


Incentive based insurance (often called smart insurance), where the insured can affect the premium level and receive other benefits by her behaviour and choices, is currently subject to considerable interest and product design activities by insurers. To study the opinions of Finnish customers on incentive based insurances we set up a survey.

The respondents replied the nonlife insurance questions rather positively. Life insurance questions mostly received slightly positive scores, but problems exist. The student sample replied to the personal life related questions significantly more positively than the senior sample. This underlines the differences between these customer segments. The real win-win situation related to incentive based insurance was questioned by many respondents indicating cognitive biases.

This study finds that successful development of incentive based insurance products requires that insurers study and test carefully their potential customers’ opinions. This emphasises the role of experiments and inquiries.


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Copyright (c) 2017 Raimo Voutilainen

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.

Creative Commons License
This work is licensed under a Creative Commons Attribution 4.0 International License.