Lloyd’s of London, the 330-year-old insurance market, is pushing to revamp auto coverage as the rise of driverless cars looms.
Chief Executive Officer John Neal said that Lloyd’s is talking with automakers about how to set up different policies to stay relevant as car ownership changes. The shift is “inevitable” as companies such as Tesla Inc. explore their own insurance options, he said in an interview Monday.
“Within five years, particularly in an urban environment, we’ll find a very different approach to the supply of a motor vehicle and the insurance that goes with it,” Neal said. “It won’t be conventional motor insurance.”
Experts have been saying that driverless cars may drastically cut the need for individuals to purchase auto policies. Neal, responding to a question about Tesla’s decision to create its own insurance product with help from the industry, said that autonomous vehicles will merely result in demand for a different product, and not the end of car insurance.