Statistical economic feasibility estimates of the Russian CMTPL automobile insurance system as a reliability theory problem

We show a method of representing basic economic characteristics of the functioning of the Russian Compulsory Motor Third Party Liability (CMTPL) system as a reliability theory system of a special kind with independent components. Each component is characterized by the number of faults (i.e., the number of road traffic accidents), its damage level (i.e., the amount of damage inflicted on third parties), and the initial endurance characteristic (i.e., the insurance premium). We mainly deal with statistical methods of graphical and analytic computerized methods for analyzing the system’s operation and further recommendations on keeping the system operational.