Not so long ago — almost two years from this day on — UK government made a huge announcement regarding IT and automobile industry. As many of us know, automobiles became smarter within the last decade, they’re almost too smart. As you might guess, we’re talking about driverless cars, presented by various technology and motor giants, such as, for example, Google Inc or Nissan.
The UK government statement allowed driverless cars on the roads of the country, which was undoubtedly one of the game changing government solutions to date. The future is now: you don’t have to be a driver to drive a car. That decision drastically changed industry in the UK, and with all of questions and thoughts there is regarding insurance role change in this whole situation.
What are the potential insurance implications for driverless cars? How will the technology effect current motor risks, and what new risks will emerge?
Not only UK, but — of course — Japan has legalised driverless cars usage. However, Japanese government allowed to use only Nissan cars. With more and more countries jumping into the new reality, adopting transformed way of moving across our mother Earth — there must be clear understanding of what insurance may become. And that is why: according to researches by AlertDriving, people are the reason for accident happening. More than 90% of accidents — which is quite a great number — happened due to so-called “human error”. That means that adopting driverless cars may reduce insurance companies premiums and claims.
Affection of insurance industry is near: Forbes published a research with an assumption that even small adoption rate (such as 20%) of driverless cars will lead to significant reduction in the accidents number. This will lead to cutting costs of premium insurance programs, which may later change the industry.
How the industry will answer to the new future? Only time will tell. We can’t assume wide spreading of an adoption is already here, but it’s coming, step by step. By the way, the reason why it’s not here in a serious volumes might be the insurance industry. But within sometime, we will be able to make a serious assumption on how the technology changes business.