Driverless Cars Will Change Auto Insurance. Here’s How Insurers Can Adapt

Autonomous vehicles will have a huge impact on the automobile insurance industry. A forecast shows that the drop in individual premiums – due both to decreased private ownership vehicles and to safer vehicles — will begin in 2026, as large numbers of autonomous vehicles begin to appear, and could be as much as a $25 billion loss for insurers by 2035. Though the shift to fully autonomous vehicles will be gradual, auto insurers will face some stark strategic choices. They can continue to conduct business as usual, fighting for pieces of a shrinking pie – or they can change their thinking and their business models and adapt to new realities. Three areas with potential for insurers are cyber security, product liability, and infrastructure insurance.