Taxi Car Insurance Quotes

They looked at the world around them and saw that the government was a ball of wasteful red tape; that the taxi industry treated customers like shit; hotels overcharged and overtaxed; health care was a sham, driven by the needs of the insurance agencies, not the sick; oil-dependent cars had helped to justify an eternal war in the Middle East; and illegal drugs were only illegal because the government wanted to control the people.

Of more angst to drivers are the customer ratings systems imposed by the app companies. While most drivers do not have a problem with the notion of being rated, they are concerned that they will receive poor marks for circumstances beyond their control. Customers can give even the most earnest drivers bad ratings for any reason such as bumpy rides over pothole strewn roads, traffic congestion and passengers underestimating how much time they need to reach their destinations. Miscommunication between passengers and drivers can occur because passengers cannot speak the local language, are drunk, or fall asleep and cannot direct the driver to their remote destinations. Perhaps some passengers just do not like the ethnic group to which some drivers appear to belong. Circumstances such as these are clearly the fault of passengers who may rate drivers poorly nonetheless. Drivers with low ratings can be expelled from on-demand taxi services. This unfairness is compounded to the extent that drivers make large investments in their cars, insurance and fuel. Making drivers, who basically invested in a franchise, vulnerable to expulsion from a system because of unfair ratings seems to me to be a potential source of dissention or even litigation. Another concern associated with the taxi app business model is that drivers only have 15 seconds to respond to notices of pick up opportunities. Drivers that fail to respond in such tight windows lose the business. Repeat failures to make timely responses can result in temporary suspensions. This pressure, and related distractions associated with interacting with handsets, is applied simultaneously with all of the challenges of navigating traffic in a variety of weather conditions. Foremost, this is a driving hazard that imperils everyone in the vicinity. It also ties in with the ratings systems because drivers are only rated on the rides they complete. Drivers who claim rides but abandon the customer if it looks like the pickup will be delayed have no ratings risk. Paradoxically, no ratings result in the worst customer service as passengers end up stranded.

The most important modification that must be made to a standard analysis of incentives is salience. Do the choosers actually notice the incentives they face? In free markets, the answer is usually yes, but in important cases the answer is no. Consider the example of members of an urban family deciding whether to buy a car. Suppose their choices are to take taxis and public transportation or to spend ten thousand dollars to buy a used car, which they can park on the street in front of their home. The only salient costs of owning this car will be the weekly stops at the gas station, occasional repair bills, and a yearly insurance bill. The opportunity cost of the ten thousand dollars is likely to be neglected. (In other words, once they purchase the car, they tend to forget about the ten thousand dollars and stop treating it as money that could have been spent on something else.) In contrast, every time the family uses a taxi the cost will be in their face, with the meter clicking every few blocks. So a behavioral analysis of the incentives of car ownership will predict that people will underweight the opportunity costs of car ownership, and possibly other less salient aspects such as depreciation, and may overweight the very salient costs of using a taxi.* An analysis of choice architecture systems must make similar adjustments.

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