Self-Driving vehicles to put a dent in the insurance industry

February 6, 2018

As we all know that automobile industry is pairing up with major tech firms to overcome the hurdles of autonomous vehicles, it seems like all the science fiction theories are coming into reality. According to the experts, the world will start to adopt self-driving vehicles and it will approximately take 20 years to eliminate the drivers out of the league. While we see the world shifting towards autonomous vehicles, the Insurance industry will face major problems.

Insurance is one of those highly beneficial industries that earn millions with the help of the automobile industries. With millions of accidents reported on everyday basis across the globe, the Insurance industry has transformed into the most influenced industries of all time. Here are the major possible fluctuations an insurance company may face.

Lower premiums for accidents will become rare

One major reason to adopt autonomous vehicle is that all the major firms are integrating safety hazards with the help of technology, to eliminate accidental issues and make driving experience safe. All the major companies such as Google, Uber, Tesla and other leading companies are looking to integrate high-end technology that will help reduce accidents on road by a larger margin.

As we all know that accidents are the major source of income for the insurance industry, rare accidents will put an adverse effect on it. Also, it is expected that insurance companies will lower down their premiums to attract customers.

Liability for automakers

Taking drivers totally out of the contest means that if there is no driver, the automakers will be the one at fault. Automakers will probably assume this as a liability and if any mishap or accident occurs, it will be the manufacturer at fault. Companies like Mercedes, Volvo, and Google have already considered the mishap of a self-driving automobile as their liability. However, if any car manufacturer is at fault the process will go smoothly as it is per now.

The industry to struggle if there are no drivers

One another important thing to identify is that if there are no drivers, the industry will struggle a lot. With no drivers required millions of people across the globe will no longer opt to acquire personal accidental insurance. This will perhaps make things tougher for the insurance companies.

Conclusion

The self-driving vehicle is the ultimate concept which will hit the world in 2020 and will be fully adopted by the year 2040. The insurance industry should need to work and find out different ways to overcome these hurdles, otherwise, their existence will be at risk.

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