Several studies have demonstrated an inverse relationship between experience in an activity and perceived risk for the individual in the activity. That is, as experience increases, perceived risk decreases. This phenomenon has been labeled risk acculturation. The present study aims to examine prior rental car experience for its effect on estimated odds of an accident and likelihood to purchase rental car insurance.
A convenience sample of 19‐24 year old students read a car rental scenario within a questionnaire and responded to questions regarding past risk behavior, car rental experience, perceived risk, likelihood of insurance purchase, and related topics.
Compared to people who had not rented a car before, people with prior rental experience estimated the odds of an accident involving their vehicle to be significantly less likely (a risk acculturation effect). Also, subjects with prior rental car experience were significantly less likely to purchase a collision damage waiver and supplemental liability insurance. Of the variables in this study, only experience significantly predicted both types of insurance purchase. The two variables of estimated odds of an accident and knowledge of existing insurance coverage were not significant predictors for either type of insurance purchase.
Risk acculturation is best documented through a longitudinal study rather than the present cross‐sectional investigation. Although a sample of young adults with limited driving experience was helpful in identifying respondents who had not rented a car before, the results of the present study may not generalize to the broader population of car drivers.
The present study may be the first to identify a risk acculturation effect within an insurance context. However, the effect of experience on insurance purchase is independent of that of risk acculturation, and further research is needed to clarify the mechanism of the effect.
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