Wednesday, July 22, 2015


One outcome of automated cars has been little talked about -- the fate of car insurance.  With a driverless car, the number of times one is in a wreck will plummet -- at least if you can take Google's driverless cars as evidence.  Who needs insurance when a vehicle with a never-tired computer traverses the roads?  Auto insurance companies are assuredly paying attention to the growth and maturation of telematics and vehicle guidance.  Look for them to start giving breaks to vehicle owners who have back-up cameras, self-parking systems, lane watch controls and automatic distance keepers that are already in showrooms.  The final step of getting rid of the driver will be the big disruption.  Will auto insurance companies go away?  Not right away and perhaps, never, but their offerings will have to change along with their actuarial estimates of how often a driver is in an accident.  Look for mergers among car insurers in the coming years as fleets turn more and more to automation.  Although I am happy with my insurer, USAA, I would be even more content if I didn't have to shell out hundreds of dollars a year.


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