Will Fewer Drivers On The Road Mean Lower Auto Losses? It Depends (Visualize)

Will Fewer Drivers On The Road Mean Lower Auto Losses? It Depends

Tuesday, April 21st, 2020 Auto Liability

Staying at home and closing nonessential businesses during the COVID-19 crisis has resulted in one major benefit for people who still need to drive their vehicles: fewer cars on the road.

But the question is: Will the decrease in vehicle use ultimately result in lower auto losses for insurers?

The question comes down to two ways we measure losses: frequency and severity. Fewer cars on the road will likely mean fewer accidents and claims, leading to a decrease in frequency.

But fewer cars may also have some offsetting severity-related effects.


External References & Further Reading
https://www.verisk.com/insurance/visualize/will-fewer-drivers-on-the-road-mean-lower-auto-losses-it-depends/
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