Driverless Cars and the Future of Insurance

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Advancement in various technologies is being developed faster today than ever. One technology trend I have been reading about and studying is the impact of driverless cars on the industry. If you believe Renwick of Progressive, the time to worry will be quite a bit into the future.

I’m not so sure.

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the impact of this technology on the insurance industry will be sooner and greater than most people currently realize. While the future is notoriously difficult to predict, the following are a few reasons why we are discussing this NOW…

In 2008, a driverless car could go about two miles on a closed course. In 2012, Google’s driverless cars logged over 300,000 miles on actual roads. The technology appears to be developing faster than most realize.

Volvo—known for auto safety—predicts they will be able to eliminate crashes for anyone driving its cars by 2020. That’s less than seven years from today. Nissan has also announced similar plans. It seems that Google has sparked a technology development race in the auto industry—and this will spur rapid technology innovation.

If accidents are reduced, claims will drop. Google predicts it can eliminate 90% of auto accidents. While this number is hard to believe today, even if the drop is only 25% of today’s level, a $1,000 car insurance policy would drop to $750. What happens to industry revenue including insurance agents’ commissions?

Learn how this advance will disrupt other industries…

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