US: autonomous vehicles could catch insurers off-guard image

Around 84 percent of US auto insurers don’t see self-driving vehicles making a major impact on their business model until around 2025 – but the latest pledges coming from automakers could advance that date soon.

Auto insurers are vastly unprepared for the modifications brought on by the appearance of driverless cars and according to a new study made by consulting firm KPMG the vast majority don’t believe their business model would be impacted sooner than a decade from now. The research focused on executives of insurance companies that deal with $85 billion worth of insurance premiums, asking them a set of questions that sought to find if they had the knowledge and opinions on autonomous transportation. Around 84 percent of them don’t believe their business model would be crucially impacted by the self-driving autos before 2025. “The disruption of autonomous vehicles to the automotive ecosystem will be profound, and the change will happen faster than most in the insurance industry think,” said Jerry Albright, who handles KPMG’s actuarial and insurance risk practice. “To remain relevant in the future, insurers must evaluate their exposure and make necessary adjustments.”

While costs and how fast consumers would embrace autonomous transportation can only be speculated, but the truth is that advances have been made very quickly – with semi-autonomous systems already available or coming in the near future. For example Google is already testing a fleet of 100 autonomous cars and plans to release them on the streets surrounding its California-based headquarters. Tesla is getting ready to roll out an over the air software update that would let its cars incorporate the Auto Pilot feature, a semi-autonomous technology.