The transportation sector is experiencing significant disruption as a shift involving the industry’s entire ecosystem is taking place. Consequently, the auto insurance industry must start planning now to stay ahead of the curve and handle disruptions in the face of the changes autonomous vehicles can bring.
Although changes are happening at a deliberate pace, the auto insurance industry has been preparing for the impact of autonomous vehicles for many years. Major national insurance carriers have been using big data and instant driving analytics to formulate future insurance models inclusive of pricing, coverage and rating.
Carriers also are pushing discounts for customers who elect to have telematics devices installed in their cars, allowing companies to continue to gather valuable data analytics.
However, one primary concern in developing future insurance models is that even as the frequency of accidents could drop, the impact of these accidents increases because of the high costs of AV technology.