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Self-driving cars could upend the current auto insurance market, The Wall Street Journal reported.
As much as 80% of the $200 billion auto insurance market could be altered, or even potentially evaporate, because of the emergence of self-driving vehicles.
The advent of self-driving cars will radically shift responsibility when driving. With the car’s computer in control and in communication with other cars on the road, accidents will likely drop precipitously. That would decrease the risks and prices associated with insuring these vehicles.
This change might come faster than the industry expects. BI Intelligence, Business Insider’s premium research service, projects there will be 10 million cars with self-driving capabilities on the road in 2020, the majority of which will be semi-autonomous – they can drive themselves in some situations, but not in others, like Tesla’s Autopilot. In these cases, insurers will need to determine who is liable in an accident when the driver isn’t controlling the vehicle. Manufacturers such as GM can be liable for defective parts that require recall, but extending that liability to the car’s self-driving system would radically shift the paradigm of auto manufacturing and purchase.
These complications could be pave the way for a transformation of the current car ownership model. Numerous major carmakers are investing in ride-sharing companies. If hailing rides from self-driving taxis becomes the most common mode of transportation in the future, as some predict, it would remove the consumer from the liability question.
Issues such as this will continue to arise as self-driving cars approach mass adoption in the next several years.
John Greenough, senior research analyst for BI Intelligence, has compiled a detailed report on self-driving cars that examines the major strides automakers and tech companies have made to overcome the barriers currently preventing fully autonomous cars from hitting the market. Further, the report examines global survey results showing where fully autonomous cars are highly desired.
Here are some key takeaways from the report:
- Three barriers have been preventing fully autonomous cars from hitting the road: 1) high technological component prices; 2) varying degrees of consumer trust in the technology; and 3) relatively nonexistent regulations. However, in the past six months, there have been many advances in overcoming these barriers.
- Technology has been improving as new market entrants find innovative ways to expand on existing fully autonomous car technology. As a result, the price of the components required for fully autonomous cars has been dropping.
- Consumer trust in fully autonomous vehicle technology has increased in the past two years.
- California became the first US state to propose regulations. California’s regulations stipulate that a fully autonomous car must have a driver behind the wheel at all times, discouraging Google’s and Uber’s idea of a driverless taxi system.
In full, the report:
- Examines consumer trust in fully autonomous vehicles
- Identifies technological advancements that have been made in the industry
- Analyzes the cost of fully autonomous technology and identifies how cost is being reduced
- Explains the current regulations surrounding fully autonomous cars
To get your copy of this invaluable guide, choose one of these options:
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The choice is yours. But however you decide to acquire this report, you’ve given yourself a powerful advantage in your understanding of the emerging world of self-driving cars.