Autonomous Vehicles & Insurance

2019-04-16T17:05:19+00:00December 10, 2018|

Sci-fi fans may have been waiting for the invention of flying cars for decades, but it’s self-driving cars that are quickly becoming our new reality. Automated vehicles are one of the great technological revolutions of our time, but learn why they cause fear in the hearts of insurers.

For insurance companies, the shift to automated vehicles can be fear-inducing: Automated cars will ultimately result in fewer accidents, leading to rapid remodeling of the insurance industry. According to research by Accenture and the Stevens Institute of Technology, as many as 23 million fully automated vehicles will cruise on U.S. streets by 2035. As a result, insurers could see losses as great as $25 billion. Even worse, a report by KPMG puts expected losses by 2050 at $137 billion.

It’s hard for insurers to see these numbers and remain calm, but these projections assume we’ll behave as we always have. Although automation is emerging quickly, we have enough warning to make plans before the technology is perfected, implemented, and trusted — but that window is closing.

According to a survey by AAA, 63 percent of U.S. drivers are afraid to ride in a self-driving vehicle. The rate of fearful drivers was 78 percent last year.

Many trucking companies are in the same place as the general population — waiting patiently for autonomous trucks to reach a level of trustworthiness before adopting them — with the added layer of waiting for consumer expectations to progress.

However, quite a few trucking companies are already implementing automated safety features to reduce accidents caused by driver error, the main cause of all accidents.

This is a major reason the American Trucking Association supports automation.

Additionally, semi-automation can ease the physical requirements associated with long-haul trucking expeditions, perhaps lessening the impact of the persistent industry problem of driver shortages.

Economically, there are benefits as well: Drivers could get the rest they need while enabling the trucks to be on the road for longer periods of time. This, in turn, would make shipping more efficient.

Read the full story here.