Insurance Statistics

Tom Christiansen tomchr at ee.washington.edu
Thu Mar 27 15:25:49 EST 2003


Hi,

>My apologies on the last post. In trying to be concise, I think I was
>just unclear :o) The agents I've talked with are all correct in their
>statistical assumptions. Given that I may choose from any # of vehicle
>to drive on a given day, there's equal chance that I'm going to wreck
>any one of them. Granted, some cars see 7k miles a year, others are
>seeing close to 200 miles. Still, lets just assume that they all get
>driven equally. In that case, there's equal chance of any one of them
>being in an incident.

Sure, but that chance/risk is constant regardless of how many cars you own
or drive - assuming that you can only drive one car at a time, and that the
probability of ending in an accident is only dependant on the sum of miles
driven.

So regardless of how many cars you drive - as long as you only drive one at
a time (i.e. don't loan your other cars to ppl), then the risk the
insurance company sees is constant. - At least with respect to liability
and collision. When it comes to comprehensive, the risk seen from the
insurance company's point of view is (# of cars) times higher.

Tom




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