Auto insurance industry may face the advent of driverless cars

Self driving car auto insurance

Self driving car

Report shows the rise in popularity of self-driving vehicles amongst automakers

Self-driving cars may have a powerful impact on the auto industry, according to a new report from the Center for Automotive Research (CAR). The report shows that the auto industry is on the verge of commercializing self-driving vehicles, suggesting that the first of these could be seen en masse beginning in 2019. While self-driving vehicles may be the wave of the future for the auto industry, the y could have serious implications for the auto insurance industry, especially if these vehicles get into frequent accidents.

Driverless vehicles to be made lighter and considered “crashless”

The report shows that automakers interested in producing driverless vehicles are cutting weight from such cars. Removing weight reduces the reinforcement these vehicles have. This is often considered a prudent practice due to its ability to lower the cost of manufacture. Automakers believe that driverless cars would be less prone to accidents, thus eliminating the need for excessive protection. Because the vehicles will be operated by advanced computer systems, some automakers believe that auto accidents will be a thing of the past, thus putting an end to auto insurance.

Auto insurance industry takes issue with the risk associated with driverless vehicles

The report shows that the auto industry has ambitious plans for driverless cars, but the auto industry is not as optimistic of the capabilities of these vehicles as manufacturers appear to be. The auto industry is primarily concerned with the removal of safety features from vehicles. Insurers claim that the absence of safety features even in vehicles that are not controlled by humans presents a serious and expensive risk. There is always the possibility that a driverless vehicle could malfunction and cause an accident, as has been experienced in the past with Google’s own automated cars. Without safety features, auto insurance could become an expensive form of protection that very few consumers would be able to afford.

Auto insurance industry may clash with car makers in the near future

Automakers and the auto insurance industry may be poised to clash in the near future over the issue. Insurers may be disinclined to provide coverage to consumers that own and operate automated vehicles because of the risk they represent. Automakers are keen, however, to tout the safety of these vehicles and of the computer systems that govern them. Time will tell whether there will be a victor or the two industries will work together to tackle the potential issues they face in this sector.

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