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Accidents of company cars. A full service leasing company’s perspective

Author

Listed:
  • Marcin Owczarczuk

    (Warsaw School of Economics)

  • Damian Przekop

    (Warsaw School of Economics)

Abstract

In this article we deal with insurance claims on company cars. Company cars are granted to employees as working tools or as perks. Usually end car users are not directly involved in insurance payment so they may be not interested in reducing number of accidents or damages of a car. This may cause a moral hazard. Based on evidences from Poland, we analyse the market of car leasing companies with respect to the claim liquidations. Then, using a sample gathered from one of the Polish full service leasing companies we build a hurdle negative binomial regression model to explain factors influencing the probability of a claim and number of accidents. We especially concentrate on those predictors which are related to increased damage rate because of the moral hazard.

Suggested Citation

  • Marcin Owczarczuk & Damian Przekop, 2014. "Accidents of company cars. A full service leasing company’s perspective," Applied Econometrics Papers, Department of Applied Econometrics, Warsaw School of Economics, vol. 1(1), pages 39-63.
    • Handle: RePEc:wse:journl:v:1:y:2014:i:1:p:39-63
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    References listed on IDEAS

    as
    1. Angers, Jean-François & Desjardins, Denise & Dionne, Georges & Guertin, François, 2006. "Vehicle and Fleet Random Effects in a Model of Insurance Rating for Fleets of Vehicles," ASTIN Bulletin, Cambridge University Press, vol. 36(1), pages 25-77, May.
    2. Rainer Winkelmann, 2008. "Econometric Analysis of Count Data," Springer Books, Springer, edition 0, number 978-3-540-78389-3, September.
    3. Artis, Manuel & Ayuso, Mercedes & Guillen, Montserrat, 1999. "Modelling different types of automobile insurance fraud behaviour in the Spanish market," Insurance: Mathematics and Economics, Elsevier, vol. 24(1-2), pages 67-81, March.
    4. Cummins, J David & Tennyson, Sharon, 1996. "Moral Hazard in Insurance Claiming: Evidence from Automobile Insurance," Journal of Risk and Uncertainty, Springer, vol. 12(1), pages 29-50, January.
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