We are in the golden age of autonomous technology, with new car models rolling off the assembly line daily with state-of-the-art crash avoidance features. Innovations such as parallel-park assist, automatic emergency braking, lane-keeping technology, blind-spot assist and forward collision warnings present both opportunities and threats to insurers. Below is a list of five things auto insurers can do to get a leg up on the autonomous technology revolution.
Executive SummaryInnovations like crash avoidance systems and driverless cars are changing the game for auto insurers, and those looking to compete will need to be prepared. Here are five steps insurers can take to ensure they will not only survive but thrive in the autonomous technology boom.
1. Re-evaluate underwriting processes and liability.
A recent KPMG survey found that most insurance executives don’t believe autonomous vehicle technology will have an impact on their business in the next decade. More concern is warranted, however, because the rapid development of collision avoidance systems and driverless cars will require auto insurers to develop new underwriting guidelines. The problem is a significant challenge to insurers, as autonomous technology will gradually render traditional underwriting obsolete. No longer will an insured’s driving history provide key guidance on the risk they pose on the road; rather, insurers will instead need to underwrite based, at least in part, on the specs and history of the vehicle itself, and its features, as well as real-time driving data, will be used to calculate rates.