AUTONOMOUS VEHICLES
WELCOME TO THE DECADE OF
AUTONOMOUS VEHICLES!
T
he world of driverless cars is
still a great unknown—for
most insurance professionals
as well as the general
public. What impact will the
autonomous vehicles of the not-too-
distant future have on the insurance
industry? In an ideal world, of course,
these driverless cars will be so perfectly
designed that the auto accident as we
know it today will become a relic of the
past. develop viable models. According to CB
Insights, which is backed by the National
Science Foundation, over 40 companies
currently have autonomous vehicles in
development. These include familiar car
brands such as Audi, BMW, and Ford;
huge technology corporations such as
Apple, Amazon, and Cisco; and numerous
partner groups of various automotive and
technology companies. Others are small
start-ups just trying to break into the
industry.
According to the Insurance Institute
for Highway Safety, there are expected
to be 3.5 million autonomous vehicles
on the road by 2025 and 4.5 million by
2030. These vehicles are categorized
into six levels, based on their degree of
automation. For example, according to
Synopys, a Level 2 “Partial Automation”
vehicle may perform just steering and
acceleration functions electronically while
a Level 6 “Full Automation” vehicle will
perform all driver tasks without human
interaction. According to consulting giant
McKinsey & Company, adoption of these
stages of automation will be gradual,
with Level 4 automation projected to be
available between 2020 and 2022, and full
automation not until 2030 at the earliest. Once full automation becomes a
reality, the likelihood of a driver-caused
auto accident will drop to zero. If any
assignment of liability is required—say,
due to a faulty vehicle—it would most
likely lie with the manufacturer. Although
we may expect fewer accidents, the cost
of any repairs may rise since part supplies
may be limited and more-complex
technology may add to their cost.
Since the potential market for
autonomous vehicles is huge, both new
and established companies are racing to
One unknown is the potential risk
of stolen or manipulated personal
information from onboard computer
systems. This could lead to all types of
potential exposures including identity
fraud, confidential data breaches, and
even physical safety threats such as
automobile crashes. Once autonomous
vehicles begin penetrating the market,
cyber liability policies for automobiles
could become the new normal. Whether
this type of claim would fall under an
automotive policy or a homeowner’s
policy is yet to be determined.
For the time being, there’s not much to do
for the average insurance agent, provider,
or insured. All we can do is watch and
learn as this exciting market continues to
unfold in the 2020s and beyond. +
BY: SHARILYN TANAKA,
VICE PRESIDENT – PERSONAL LINES,
ATLAS INSURANCE AGENCY
CONTINUE READING ON PAGE 28
Sharilyn Tanaka is Vice President of
Personal Lines and has worked on a variety
projects across different departments,
allowing her to develop a multifaceted
approach to servicing clients. She joined
Atlas a decade ago as a Personal Lines
Account Manager and currently oversees
the sales and servicing of all personal lines
client accounts.
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