A route-based incentive program is introduced where drivers get rewarded for taking the safest routes. The program is operated with an incentive structure by the logistic company and a variable insurance premium scheme bythe insurance company. The logistic company offers incentives to its drivers for them to follow the safest routes, and by doing so expects to pay lower insurance premiums for its vehicles. The insurance company charges a discounted premium for vehicles which follow the safest routes, while expects to pay less for potential accident claims. The theoretical framework, including the set up of the incentive structure and the variable premium scheme, is presented in this paper. The cost benefit analysis is also formulated for the drivers, the logistic company and the insurance company. An online survey is conducted to assess drivers response to the incentives. The results confirm that drivers rate the incentives high in their route choice decision making. The existence of a win-win situation for the two companies is then demonstrated. Optimization of the incentive program is also formulated, which is a bi-level programming problem.
Samenvatting