Assessing Public Acceptance of Connected Vehicle Systems in a New Scheme of Usage-Based Insurance

Abstract

The consequences of road accidents are significant for drivers and society. The connected vehicle system (CVS) is a promising technology that can improve road safety by warning drivers of traffic hazards. Broad implementation of the CVS could mitigate the harmful consequences of road accidents. Widespread implementation requires schemes that can promote the pervasive adoption of the system by drivers. This study proposes the innovative idea of implementing the CVS in usage-based insurance (UBI) as a measurement probe and modeling drivers’ acceptance of the new UBI scheme. This study developed a random effect logit model demonstrating that the drivers of cheaper vehicles and middle-age drivers (30 to 60) were more inclined to accept the new UBI scheme and use the CVS in their vehicles. Risk-averse drivers were more likely to accept the scheme than were other drivers. The pervasive implementation of the CVS can be costly, but it can improve traffic safety. Because of the two-way spectrum of the costs and benefits of the CVS, providing comprehensive projects to develop the system is important for CVS investors and developers.