Risk rating from road traffic accident fatalities for the world insurance sector

Abstract

Traffic insurance is a system that compensates the insured for various damages that may arise due to accidents. Insurance companies finance these damages with the premiums received from the insured. Suitable insurance premium tariff. It keeps the customer demand in optimum balance and at the same time affects the financial success of the insurance company. Therefore, there is a need for optimal pricing. In order for insurance companies to establish the optimal risk-pricing balance, they need to rate the risks. Rating the mortality risks due to traffic accidents also allows insurance companies to price appropriate premiums. For this reason, the aim of this study is to rate the global traffic accident related mortality risks by countries. This study examines the global distribution of road traffic mortality by analyzing data from 231 countries using the DBSCAN algorithm. By classifying the number of deaths per 100,000 population, we identify patterns of similarity and show that countries can be grouped into 27, 8 or even as few as 7 distinct classes, depending on the tuning parameters of the DBSCAN algorithm. These results suggest that, despite the large number of countries, road traffic fatalities show similar patterns that can be attributed primarily to human factors. The classification highlights the importance of focusing on vehicle and driver-related issues rather than infrastructure, which appears to be less of a differentiating factor between countries. This findings have important implications for policy makers and insurance companies aiming to reduce the number of road deaths through targeted interventions.