A new study suggests premiums will fall by two thirds as more and more cars feature autonomous tech
A new research has found that the cost of car insurance is expected to go down by 60% when motorists switch to fully autonomous car technology in the future. The research was carried out by Autonomous Research and it concluded that UK insurance premiums will be slashed by 63% by 2060. This will cause the motor insurance industry to decline by over 80 per cent.
Motor insurance policies make up for 42% of the global insurance market with human error being the biggest cause of accidents. To break it down further it says rear-end shunts, with two-thirds occurring at speeds below 30mph, whereas parking and reversing scrapes cause nearly a quarter of all claims. The average motor insurance policy in the UK last year was £357.
The report also says that when fully autonomous cars come on the road, motorists making a claim will come down to 2.4% from 9% by 2060. The fall in numbers is already on the way as semi autonomous cars boast features such as adaptive cruise control and autonomous emergency braking (AEB) have cut accident rate for motorists.
Autonomous Research identifies the year 2025 as a “pivotal point”, after which fully driverless cars will really start to bring down premium prices. By 2064, Autonomous Research estimates fully driveless cars will be available worldwide.
The report also says that basic advanced driver assist functions like AEB has cut down accident rates by 14% and these will come down to 36% with more advances systems in the future.
It said: “While Google & Tesla focus on fully autonomous solutions, established car makers have opted for a gradualist approach, progressively introducing advanced driver assistance systems (ADAS) first to the luxury end of the market, then more widely”.
“Research suggests that these technologies prevent crashes. Depending on price, there is public appetite for them. Historically it takes 15 years for new technology to penetrate 95% of new car sales, a further 15 years to fully penetrate the fleet. However it could be quicker this time around given the sea change in customer experience.”