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View Poll Results: Will self driving autos kill car insurance?
Of course 42 16.28%
Maybe but not for a long time 187 72.48%
I'm a luddite... 29 11.24%
Voters: 258. You may not vote on this poll

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  #11  
Old 01-22-2013, 09:25 PM
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Auto insurance could become commercial lines only with premium paid by the manufacturer and the cost wrapped up in the purchase price of the vehicle. Then something like a consumer warrantee could be purchased to cover things like hail damage, junior bouncing a basketball on the hood or spilling a chocolate milk shake in the back seat.
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  #12  
Old 01-22-2013, 09:31 PM
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No, never happen. Insurance will still be on the policyholder, as it would be too expensive to be on the GL.
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  #13  
Old 01-22-2013, 09:32 PM
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Prior discussion on this

http://www.actuarialoutpost.com/actu...d.php?t=245849
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  #14  
Old 01-22-2013, 09:33 PM
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My reactions -- safer cars, more affordable insurance ... the things these vehicles hold promise to are good for insurance industry. And yes, I think auto insurance will be around advent of these driverless cars.
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Old 01-22-2013, 09:52 PM
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Auto insurers are the primary driving force behind much of the safety improvements in the last 25-30 years. Why would they fight this. Frequency will drop huge. Severity will spike up, as faster speeds and more expensive bits to replace add to medical costs and repair costs. Loss Costs will probably drop 75% if we get to the point that virtually all cars are self-driven. Premiums probably 70%. Inflation will eat a lot of that savings away since this is probably a 30 year transition period.

So maybe the auto insurance market is in for 3 decades of very slow organic growth. Possible, but not totally destructive.
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Old 01-22-2013, 09:56 PM
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Quote:
Originally Posted by McUSA View Post
Driverless cars don't crash.
Nonsense.

You're only saying that because nobody has ever made it.
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  #17  
Old 01-22-2013, 10:02 PM
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How much testing has Google done with their cars in inclement weather?

How well does their technology work when there's dense fog or a torrential downpour?

To what extent can a driverless car anticipate an untested obstacle and properly navigate said obstacle?

And what of the situation when the technology fails to operate properly because the owner does not perform due diligence for regular maintenance?

I don't think the auto insurance industry has too much to worry about in terms of its survival . . . it'll just have an added component.

FWIW, a few states that allow these devices on the road do so with the owner of said auto generally having strict liability in the event of an accident when the auto is in "auto pilot".
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  #18  
Old 01-22-2013, 10:15 PM
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Quote:
Originally Posted by MountainHawk View Post
Thanks, I checked back a bit but not far enough apparently!

Anyway, you are crazy if you think that this is just a blip or a fad. The technology is already there - probably better than a human but who knows all the permutations. Driving is not incredibly complex - go the speed limit, stay in the land, follow traffic signals, avoid hitting obstacles. In 10 years, it will be much better.

It's easy to think auto insurance - a mainstay product for 100 years - will always be there but history is full of obsolete products. I'm sure we all would have looked forward to a great career being the assistant manager in a video store in the 80s (okay maybe not).

If driving goes away, then a large chunk of the insurance market goes away because the product is built upon negligence - and the machines won't be negligent.

I'm glad that I'm at the tail end of my career, because I think this will be a major contraction in the P&C industry.
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Old 01-22-2013, 10:21 PM
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Quote:
Originally Posted by MountainHawk View Post
No, never happen. Insurance will still be on the policyholder, as it would be too expensive to be on the GL.
So you think that current GL policies are adequate for the kind of exposure that self driving autos present? I'd say it's more like WC where coverage is defined by regulation and case law than by policy forms.
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  #20  
Old 01-22-2013, 10:39 PM
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Quote:
Originally Posted by McUSA View Post
Thanks, I checked back a bit but not far enough apparently!

Anyway, you are crazy if you think that this is just a blip or a fad. The technology is already there - probably better than a human but who knows all the permutations. Driving is not incredibly complex - go the speed limit, stay in the land, follow traffic signals, avoid hitting obstacles. In 10 years, it will be much better.

It's easy to think auto insurance - a mainstay product for 100 years - will always be there but history is full of obsolete products. I'm sure we all would have looked forward to a great career being the assistant manager in a video store in the 80s (okay maybe not).

If driving goes away, then a large chunk of the insurance market goes away because the product is built upon negligence - and the machines won't be negligent.

I'm glad that I'm at the tail end of my career, because I think this will be a major contraction in the P&C industry.
It is NOT a blip. I'm sure it will eventually be the way we all move around, maybe even by 2050 or so.

However:
  • The manufacturers will be exempted from liability, or it will be too risky to mass produce these.
  • Therefore, the car owner will likely have strict liability for accidents while in automatic mode.
  • These cars will still get stolen, still get hit by trees, deer, and stuff falling off bridges. They will still get destroyed by hail, floods, or hurricanes.
  • Children are still going to run out in front of cars and be killed, and society isn't going to start blaming the kid because a computer was driving.
  • Therefore, auto insurance will still be needed. Premium will go way down, maybe as much as 70%.
  • However, in nominal dollars, since that drop is a multi-decade process, the drop will likely be small.

Auto insurers have always worked hard to make car safety improve. No reason to expect them not to work to make sure this safety improvement get rolled out as efficiently as possible.


As far as the GL form --- well, I just don't think it'll go there. Auto manufacturers AND insurers would both rather see this covered under PAP (auto manufacturers to avoid the liability, insurers to spread the risk better). Two big lobbies like that will get their way, IMO.
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