Self-Driving Cars will Eventually Kill Auto Insurance
A man named Dan Pete who’s a venture capitalist an entrepreneur in the state of Southern California was looking into purchasing a Tesla Model X for himself. Like anyone, he called his insurance company to get an auto insurance quote just to see how much his premiums would rise.
To his surprise, he was quoted $10,000 a year. Somehow we think that these quotes are based on the autonomous driving on these vehicles and how they can cause accidents. It hasn’t been a walk in the park with the self-driving cars, companies like Tesla has had their bit of hiccups what their autopilot mode. The whole concept between self-driving cars to make the road safer, the ability to detect things so far in advance of the human can’t comprehend, it’s something to think about. Also, you can add on the points a vehicle’s not getting drunk, what’s going through their mobile device changing their next song on Spotify. It’s all eyes on Road and nothing else.
Moving along, everything sort of transition to a larger picture. The saying is if no one’s driving why is there a need for auto insurance? The whole time is of an auto insurance company is based on the fact that human can potentially be in an accident. Which is how insurance premiums are generative over many different factors the convergent to one figure. Statistically if stated that 90% of accidents on the road are solely due to driver error. Now if you were moved out of the equation, what’s left? Pretty much nothing if you think about it oh, that’s a large chunk removed off the road solely based on autonomous driving.
Studies shown by the Krause group with the research from the Stevens Institute of Technology have published a report in 2017 forecasting autonomous driving as it becomes more widespread. They highlighted the troubles what insurance companies can face. They’ve estimated that by the year 2035 premiums could be reduced by 12.5%. Although in turn, premiums may be dropping what’s the cost for repair on these vehicles can be quite more expensive. A vehicle that’s heavily reliant on all these different sensors, can be quite expensive to repair and that can essentially mean premiums may actually rise as more of them come off the Lots at the dealers. As the autonomous driving industry continues to evolve, you can rely on the fact that it’ll change the auto insurance industry dramatically. How would it affect insurance appraisals if the vehicles are self-driven? Find out how this company is using AI technology for faster insurance claims.
The reason for this is because the driver is not the liability at that point, but there are many questions that still need to be answered in this field. Determining who’s at fault in a situation of an accident you get kind of tricky. Think about these questions that were asked, what if a driver failed to get the latest firmware on? What if your vehicle loses internet connection during the autonomous driving face, whose fault is it? Your internet provider, or dealership?
It’s a lightly covered topic, the needs a lot more in-depth research. From the looks of it self-driving cars can either be a huge benefit for insurance companies or a huge loss. It’s all about them adapting and moving forward with the trends. Check out our Q&A with an insurance expert to see how he is changing the insurance industry.