A group of 11 major UK insurers will be meeting next month to discuss the emergence of driverless cars, and the impact they will have on the insurance industry. The fact that 95% of car accidents are due to driver error means the advent of driverless cars should, in theory, mean a lot less claims, and therefore much lower premiums. While it’s unlikely that cars without drivers will mean cars without insurance, there’s no doubt they will change the face of the car insurance industry.
But isn’t the idea of roads without drivers all still a little bit ‘sci-fi’? According to the Institute of Mechanical Engineers (ImechE), all cars travelling on UK roads may be fully driverless by 2050. Admittedly this is still some time away, so maybe it’s a bit premature to get excited about lower car insurance premiums.
Or is it? There are already a number of features being introduced to today’s cars that are as a result of the development of driverless technology, and they’re having a positive impact on road safety. Here are some of the newest features on the market:
- Autonomous emergency braking, which has already led to a reduction in accidents and a 40% reduction in personal injury claims. This feature can detect if the car in front of you has had to brake suddenly, or if someone runs into the path of your car. *
- Lane-keeping function, which steers the car so it stays in its lane, even as the road changes direction.
- Adaptive cruise control which applies the brakes or throttle to maintain speed while keeping the car at a safe distance from other cars.
- Assisted parking, one that could save marriages as well as money!
- Blind spot assist, which alerts you to a vehicle in your blind spot.
Many insurers already offer a 10% discount on cars with driverless technology, such as emergency braking systems, which typically cost between £300 and £1,000 to install. And experts predict insurance premiums could be halved by 2025 if driverless technology becomes mainstream.
Michael Ward, Managing Director of PayingTooMuch.com said “We’re seeing enormous change in the car insurance market. Developments such as black-box technology that effectively ‘watches’ how you drive, as well as driver-assistance features (once the domain of only the most expensive cars on the market, but are fast becoming available on mid-range models), are all having the effect of lowering car insurance premiums. If you’re looking to buy a new car, it’s worth considering how much adding these features could save you in the long run.”
*Source: Financial Times, 19th January 2016.
