The insurance industry is starting to contemplate the impact on car insurance with the coming of self-driving cars. Aon Plc is predicting a 40% reduction in automotive insurance premiums once there is a wide level of adoption of autonomous vehicles.
Since automotive insurance premiums equate to 47% of global insurance premiums, this will have a significant impact on the insurance companies' bottom line.
This is one of the many changes that the insurance industry will face over the coming years. We feel that there is a major change on the horizon for this industry and startups and new business models will drive much of this change.
We are actively talking to startups in this space to help drive this improvement in customer experience and overall efficiency.
Premiums for U.S. auto insurers may drop more than 40 percent once the use of automated vehicles has been fully adopted by 2050 and driving becomes safer, according to insurance broker Aon Plc. “We as an industry need to act quickly to ensure that we have the products available to align to the new paradigm,” Paul Mang, head of analytics at Aon, said at a press conference in Monte Carlo on Sunday. “Autonomous driving clearly moves the business mix to fleet products and commercial lines.” Insurers such as Allianz SE and Munich Re are trying to assess the impact of automation on their biggest non-life insurance market as carmakers from Tesla Motors Inc. to Daimler AG and Volvo AB embrace the technology. Personal auto insurance accounts for 47 percent of global premiums, according to Aon.