THE ROLE OF MOTOR INSURANCE INCENTIVES IN REDUCING ROAD TRAFFIC ACCIDENTS: THE CASE OF LION INSURANCE COMPANY S.C

Abstract

In this study, the researcher to study the role of motor insurance incentives in reducing road traffic accidents. The motor insurance incentives used by Lion Insurance Company S.C has been examined using mixed methodological approach, i.e. qualitative and quantitative. Both primary and secondary data sources were consulted where as questionnaire and interview were used as a data collection from the target respondents of the Stuffs of Lion Insurance Company S.C and service users. The respondents were selected using convenient sampling technique. Descriptive method of data analysis using SPSS 16 was employed and presented in the form of tables, figures, frequency and percentages. It is revealed that No claim Discounts and premium loading (Bonus mauls) have a huge role in promoting road safety by affecting the driver behavior. Additionally the out of pocket payments (Excess) deduction is also one of the motivator that affects the driver’s behavior on the road. Even though it’s not held frequently, trainings provided to fleet driver’s brought a significant change on the drivers by creating awareness. In order to bring a significant change training should also be given frequently for all driver’s by creating awareness about all the claim processing’s, and safety measures. Promoting the mass media in awareness creation campaigns and funding the road transport management were also revealed as an option in promoting road safety. However this activity were not actively held. Additionally it’s revealed that Addis Ababa’s road infrastructure is also a reason for the frequently accidents occurred. In general, motor insurance incentives should be highly considered as it is very important in reducing road traffic accidents by affecting driver’s behavior on the road, by creating awareness through training and by supporting the mass media and road transport management.