The Effect of No-Fault Automobile Insurance on Driver Behavior and Automobile Accidents in the United States 2001

by Loughran, David S.

• ISBN13: 9780833030214
• ISBN10: 0833030213
• Format: Paperback
• Copyright: 2001-08-01
• Publisher: RAND Corporation

Summary

No-fault auto insurance opponents frequently argue that no-fault may ultimately lead to higher auto insurance costs by reducing drivers' incentives to drive carefully and thereby increasing the accident rate. The intuition behind this criticism of no-fault is simple: No-fault auto insurance lowers the cost of driving negligently by limiting first-party liability for the injuries suffered by third parties in auto accidents. This report evaluates this criticism of no-fault by examining trends in fatal and non-fatal auto accidents rates and rates of driver negligence in the U.S. between 1967-89. This report finds no evidence that the adoption of no-fault auto insurance between 1971-76 in 16 states increased fatal accident rates in those states and no correlation between the presence of no-fault auto insurance and a state's overall accident rate or rate of driver negligence.

Table of Contents

Preface	v
Figures	ix
Tables	xi
Summary	xiii
Acknowledgments	xix
Acronyms	xxi
Introduction	1	(4)
The Relationship Between No-Fault Insurance and Driver Behavior	5	(8)
Three Tests of the No-Fault Hypothesis	13	(24)
Literature Review and Methodological Issues	14	(6)
The Effect of No-Fault on Fatal Accident Rates	20	(9)
A Difference-in-Differences Estimate	23	(3)
A Test Using Variation in Dollar Thresholds	26	(2)
Summary	28	(1)
The Effect of No-Fault on Overall Accident Rates	29	(2)
The Effect of No-Fault on Driver Negligence	31	(6)
Conclusions	37	(2)
Appendix A. Factors Contributing to Fatal Accidents	39	(4)
Bibliography	43