perezbernia92
Can you please help me a critique answer to this post!! …
Can you please help me a critique answer to this post!!
Should insurance companies charge young male drivers much higher rates until they reach 25 years old? This controversial topic has been a subject of discussion for many years, with some people believing that it is discriminatory, while others argue that it is based on actuarial science. In this post, I will delve into this hot topic, examine both sides of the argument, and provide evidence from peer-reviewed sources to support my position.
It is important to understand that car insurance rates are determined based on a wide range of factors such as age, gender, driving record, location, and type of vehicle. Young male drivers are one of the demographics that are most affected by this process, and often find themselves paying significantly higher rates than other groups. The Insurance Institute for Highway Safety (IIHS) reports that young male drivers are more likely to be involved in accidents than any other demographic group (IIHS, 2021). This is due to a lack of experience, risk-taking behavior, and peer pressure, among other factors. As a result, insurance companies charge higher rates for young male drivers to cover the increased risk of accidents and damage to property.
However, some people argue that charging young male drivers higher rates is discriminatory and unfair. They point out that not all young male drivers are reckless or irresponsible and that many responsible drivers are being penalized for the actions of a few. Additionally, they argue that the higher rates may make it difficult for young male drivers to afford car insurance, which could lead to more uninsured drivers on the road.
Despite the arguments against it, research suggests that the higher rates for young male drivers are justified based on actuarial science. According to a study by the National Bureau of Economic Research, young male drivers have an accident rate that is 50% higher than young female drivers (Dobbie & Fryer, 2016). Furthermore, the study found that the higher accident rate for young male drivers is due to their higher levels of risk-taking behavior.
In conclusion, this is a complex issue with valid arguments on both sides. However, evidence from peer-reviewed sources suggests that charging young male drivers higher insurance rates is based on actuarial science and the higher risk of accidents among this demographic group. As MBA students, we need to look at all the available evidence and base our conclusions on facts and data.
References:
Dobbie, W., & Fryer, R. G. (2016). The medium-term impacts of high-achieving charter schools on non-test score outcomes. Journal of Political Economy, 124(5), 000-000. https://doi.org/10.1086/687645
Insurance Institute for Highway Safety. (2021). Fatality Facts. Retrieved from https://www.iihs.org/topics/fatality-statistics/detail/motor-vehicle-crash-deaths-by-age-and-gender
