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Insurance Companies Looking For Fallback Plans To Survive Driverless Cars (csmonitor.com)
An anonymous reader writes: Driverless cars could mean a huge downsizing of the auto insurance industry, as the frequency of accidents declines and liability shifts from the driver to the vehicle's software or automaker. This is compounded by the rise of ride-sharing services. Once summoning a vehicle to take you somewhere isn't limited by the number of people available to drive them (and are correspondingly cheaper), car ownership is likely to decline. Many major automakers and tech companies are throwing billions of research dollars into making this happen, and insurance companies are trying to figure out how to survive. For example, a recent patent application shows State Farm is betting on collecting massive amounts of data about you. While they'll no doubt use it to set your insurance rates, they also plan to "send you advice, alerts, coupons or discounts on insurance or other goods and services." Traveler's Insurance is thinking along somewhat similar lines. They want to create "a device that offers specific suggestions for managing errands and other travel. Customers would be able to see a map of 'risk zone' data for places they want to go, such as stores, restaurants and roads. They could then plan the day 'with an eye toward how risky such endeavors may be,' according to the patent application."
They plan on monetizing this data with or without driverless cars.
If you think that "the vehicle's software or automaker" will be solely responsible for any damage or action, you're naive. This is 'Murica, land of the suit. Personal liability insurance will be a must with these kinds of things. This, of course, assumes the deep-pockets don't manage to shift ALL of the liability to the passenger who "should have pushed the emergency override button and avoided the problem".
as a longitme customer of these insurance companies i have this to say...
DONT find a way to survive you useless fucking leeches. You serve no purpose whatsoever, you are useless middlemen who profit from the suffering of others & add nothing beneficial to society.
Rather than finding a way to survive, you should curl up in a ball and die.
Its the best thing for everyone involved.
Can you imagine a world where we don't *need* insurance anymore? The idea that we are even close to that is amazing.
Sounds like the future is for candy asses.
So, what, they want to be our nannies, and they think people will just let themselves be tracked to prop up their failing business model?
I'm sorry, but why the hell would anybody want this? Wow, gee, I'll just go ahead and implant this device so you can monitor everything I do and monetize it.
How about no? I'm glad I live in a country which has real privacy laws, instead of one in which corporations assume they can just insinuate themselves into every aspect of your life for their own gain.
So much bullshit.
Lost at C:>. Found at C.
Are driverless cars really the big game changer for auto insurance?
I'm in Ontario, Canada and I just don't see how this is going to change things.
We already have 'no-fault' auto insurance, which basically means you buy car insurance to protect yourself and liability.
You don't go around suing the other drivers or anything. When you make a claim, you just deal with your own insurance company.
The rate you pay is still based on your risk.
So, we have driverless cars. You still buy insurance to protect yourself and liability.
Maybe some of the risk metrics change. Like cars with a better record of being driverless get lower rates? But that's no different than rating cars for safety today.
I suppose some countries might need to change how their auto-insurance works. Moving more towards no-fault insurance.
But it's not like the world doesn't have plenty of models to choose from that would better fit the driverless world.
They don't have to reinvent the wheel as far as I can tell.
While those posting that insurance companies aren't useful are COMPLETELY wrong, this is really just a case of sometimes an industry isn't needed anymore. If and when we no longer need drivers, we aren't going to need insurance for those drivers. Really not a problem for anyone who isn't an insurance company, and for those who are, it's natural that they'd try to find something else to do. If they can't find anything useful for us, the consumer, then they're welcome to follow the buggy whip manufacturers of old.
...how much of this data collection is designed around coming up with "risk correlates" that allow them to increase your insurance costs beyond what they could charge based on your accident and claims history?
It reminds me of the credit reporting agencies that want to include your driving history as a factor in your credit risk instead of determining your credit risk based solely on your use of credit.
No. I don't want any alternative services from you fucking parasites. I have auto insurance because my state requires me to, simple as that. The second I can kick you leeches to the curb, we no longer have a "relationship".
Don't offer me coupons, don't offer me maps, don't offer me roadside assistance, don't offer me advice - "Offer" me your absence. Just dry up and blow away like a good little obsolete industry should.
...Customers would be able to see a map of 'risk zone' data for places they want to go...
I wonder how much the insurance companies will charge business to assure their location does not show up in a "risk zone"?
.
"Pay us $1,000 insurance per month and we'll ensure your address doesn't appear in a risk zone...."
That could be quite the revenue source.
Whoever came up with that idea must live in a lily white neighborhood, because this is about as close to red zoning as is possible.
Hell, it is red zoning...
"I don't know, therefore Aliens" Wafflebox1
Because of two factors:
1. Pedestrians won't modify their behavior in any meaningfully large numbers.
2. Cars will still miscalculate and get into accidents. At least early on, a few of this will probably end up being W...T...F... sized accidents involving bad programming and human error in human-driven vehicles.
WRT #1, people jaywalk all the time. I frequently see people just jump out and expect a car to instantly stop for them. Well, what happens if the self-driven car either doesn't detect them or doesn't do so in time? Can you imagine all of the faux populist outrage?
Customers would be able to see a map of 'risk zone' data for places they want to go, such as stores, restaurants and roads. They could then plan the day 'with an eye toward how risky such endeavors may be,' according to the patent application."
Want to drive a competitor out of business? Stage some "risky" things in his area.
And who gets to decide what's risky anyway? This could blow up tiny incidents to something that causes massive droves of people to avoid a store.
And yes, while this is already somewhat possible with today's internet, we don't have a central authority who decides what's risky, and certainly not one with money invested in inventing riskiness.
Criminal Liability for self driving cars also needs to be worked out. Maybe it can be fun to have a hard-ass judge hold the deep-pockets in contempt of court if they try the EULA BS.
Anything that hurts the insurance industry is a blessing.
Insurance is the longest running legalized scam. And they have been getting steadily greedy. For example car insurance companies made RECORD PROFITS last year and they are raising rates because gas prices are too low.
It's time either they get heavily controlled by the government again or go away.
Do not look at laser with remaining good eye.
Auto insurance will always be necessary because shit happens. No matter how smart the software becomes there is always something that can happen that the programmers didn't take into account. Example: an auto thief running a red light, pushing your car into pedestrians...who get sued?
People buy cars because they love to drive.
Driverless cars will appeal to people who want to play with gadgets instead of driving, or are terrible drivers, or the few who don't like to drive. Driverless cars will not take over the roads. Ever.
"Every security scheme that is based on secrets eventually fails." - Steve Jobs
What to do with all the people who are now insurance agents - Ark B?
It must have been something you assimilated. . . .
I believe it was mentioned in the Economist that US localities issue something like $6 billion in moving violations every year.
With driverless cars, this drops to nearly zero.
Granted:
a) with a fully-implemented driverless system, logically then you probably need fewer officers because you're not policing the roads so much. Less ground to cover; and
b) we all despise the blink-and-you-miss-it towns squatting alongside the interstate, with their 70mph-to-35mph speed limits for 2 blocks, with one lazy-ass cop writing speeding tickets all day long to more or less fund the entire city budget.
But that latter caricature glosses over an important point: that cop sitting there is, in fact, on duty and available for emergency roles. They're not going to (or bloody well better not) sit and write you a ticket when a store gets robbed or someone gets shot. Essentially, the traffic-ticket revenue is an opportunistic and pretty-straightfoward user tax, filling the hours and hours of "nothing happening" so that when something important does happen, that officer is available.
Without that $6bn in revenue, police budgets will be distinctly pinched, and likely cause localities to raise taxes to pay for the level of police coverage to which they've become accustomed. Essentially that, or driverless cars will come with a HOST of user-based surcharges to prevent this (effective) tax from falling back on the locality.
I doubt the new system will ultimately be cheaper than the old.
-Styopa
Assuming that 50% of people would benefit and the other 50% would lose, that means a solid 15% of the population is intentionally refusing to do it. Note, that number is probably higher, as most people think they are better drivers than they actually are. Let's say that 70% of the population THINKS they would benefit from it, which means that approximately 50% of their target market says "NO thanks, I like my privacy."
excitingthingstodo.blogspot.com
Coverage for non-collision damage ("comprehensive" on your policy) is the cheapest part.(like ~2% of the premium)
This issue is a bit more complicated than you think.
"Insurance, by design, is a sham and a scam."
Insurance replaces risk, i.e., the uncertainty of the magnitude of finanical loss, with certainty, i.e., predicatable periodic premiums. Anyone who has taken on the big responsibilities of life (i.e., rearing a family, buying house to provide a home for said family, etc.) and is not independently wealthy enough to pay cash for everything up front (i.e., paying for house in full, right now, setting aside enough money to feed, clothe, and otherwise care for your dependents for as long as they are going to need) needs insurance to protect against the fact that you don't know when you are going to die and therefore be unable to follow-through on your obligations by earning money to pay for it all over time.
By leveraging our broken patent system???
Greed is the root of all evil.
Self driving cars also still need insurance; just not as much.
That is currently an unproven assumption. Possibly correct but also possibly quite wrong. It presumes that self driving cars will actually be safer than human driven cars which has yet to be established conclusively. It seems reasonable and probable but that isn't the same thing as evidence. If they do prove to be safer in real world usage then you are almost certainly right.
And a large portion of the insurance burden will fall to manufacturers instead of just on drivers.
The incidence of payment will still ultimately fall to the car owner. The manufacturers will pass on substantially all of the cost of the insurance in the purchase price of the car. Their margins are too thin to do otherwise for any length of time. Even the most profitable car companies (Toyota, Porsche) only make around 10% net margins and most make less.
Insurance companies will not be able to make the same kind of profit overall on large multinational car companies that they can on the public.
Whether or not that is true will depend on how the insurance products are ultimately structured. If they have to deal with just a few large car companies then you are probably mostly correct. But that isn't a certainty as much will depend on the legal framework that is developed around self driving cars.
Truly driverless cars are at least a decade away, if they ever materialize at all (personally, I'm skeptical).
SJW's don't eliminate discrimination. They just expropriate it for themselves.
The idea that "self driving cars" will
A. occur anytime soon or
B. drive down car ownership,
is a pipe dream.
Billions have been poured into flight control systems and they all still require someone to sit behind the yoke and monitor them. While they do have an extra dimension, they also don't have to deal with as many variables, crappy roads, detours, crappy drivers to avoid, nonsensical roads, etc.
Before driverless cars are ubiquitous, nothing less than a complete overhaul of the roads to simplify routes, clearly mark boundaries, simplify interchanges, and reduce to a minimum possible conflicts, will be necessary. Billions and billions of infrastructure overhaul.
When Fascism comes to America, it will call itself Anti-Fascism, and tell you to give up your guns.
Insurance companies are cash rich. SO they invest much of it into the markets. If they start struggling for cash the impact may ripple through the entire economy.
putting the 'B' in LGBTQ+
Why would insurance companies need to be figuring out how to survive? True, there may be less vehicles in the future, but they will still be insured. Yes, the vehicles may be safer and have fewer accidents, but they will still be insured. Insurance companies profit from managing the risk. Yes, they will have lower gross revenue, but they will also have lower expenses. The net effect should be unchanged.
That is, of course, assuming that insurance companies aren't charging inflated rates in the current climate.
70mph-to-35mph is banded by some states on interstates or the rules are set that the funds go to the state and not the local town.
also some places need to move cops off the BS tickets roll and back to real police work. Also auto-drive cars will cut down on DUI's
Insurance, by design, is a sham and a scam.
If you think that then you would be wrong. Oh sure, there are insurance scams out there. But that is not the same things as insurance being a scam. Insurance is about mitigation of risk. Reducing the financial consequences of rare or severe events. Insurance is a very useful tool but if you don't use it properly then like most tools it might do more harm than good. People who are financially sophisticated typically have quite a lot of insurance and for good reason.
So by design, premiums MUST exceed payouts.
Not actually true. Premiums + Investment profits must exceed payouts over the long term. There are two parts to every insurance business. The premium payments you send in and then on the back end the insurance company invests those premiums. People don't typically see the investment side of the business but it's very important. Lots of insurance companies actually sell insurance at an underwriting loss but make a profit by investing the money. This isn't ideal from the insurance company's perspective but due to a competitive market it is sometimes necessary. There are more than a few insurance companies that have taken underwriting losses for many years in a row.
All insurance companies will take losses periodically but so long as they have sufficient reserves this is expected and acceptable. For risks where they lack adequate reserves insurance companies can get re-insurance (basically insurance for the insurance) for those events.
In reality, the only thing insurance protects you from that you couldn't do on your own are the extreme situations.
Insurance is for extreme events but it also can be to mitigate damage for events that you can afford to deal with. For example I have dental insurance. I am perfectly capable of paying out of pocket for any dental procedure I am ever likely to have but my dental insurance helps me mitigate the cost so pay a little up front to come out ahead in the long run. It ensures that the insurance company works when negotiating rates with the dentist so I get better rates than I could negotiate on my own.
Already the roadways are getting safer. We have adaptive cruise control, lane departure systems and, most importantly, things like airbags that minimize human damage in the case of an accident. Sheet metal is cheap compared to organs. In the US (and I think most of the world), cars only have to meet the safety requirements in place at time of manufacture. There are still cars from the 1980s and 1990s on the road (mostly Corollas and Camrys that were great cars at the time) with no air bags or only two front air bags. As those eventually age out of the fleet, injury costs will keep dropping.
Does anyone but the most optimistic of geeks really believe that autonomous road vehicles will make much of an impact on private transport in the next 50 years? Come back when it can fly and dodge the kids on hoverboards.
Insurance companies make money by trying to screw you as much as possible when it comes time for them to pay out.
Someone w/ State Farm hit the house that I was fixing up 3 years ago. I had his insurance info from the police report -- so I called State Farm. They told me to get two quotes ...
Of course, I was preparing for a trip ... and when I came back, it was Christmas. I don't know how many contractors I called, but some wouldn't work in my area (PG County, MD is known for having some problems w/ permitting). Others wouldn't deal with asbestos (the house had asbestos shingles ... which were now damaged).
During all of this, State Farm's only response to me was to send me a letter 4 months later. (they claimed they also sent me something 2 months later, but I never saw it). Of course, by then, I'm trying to train the new employee at work.
Then I get in trouble for getting pissed off at my new employee when they kept asking me how the construction was going, even though I kept repeating 'I don't want to talk about it'. Which made it up to company management on the same day as the Navy Yard shooting. So then I had to deal with all of that crap.
Over the next couple of years, I get at least three contractors to come out ... yet no one wants to bid on the work.
I called State Farm, and told them they needed to find me a contractor ... but was told they didn't do that. They *finally* sent out an adjustor (only a couple of months from hitting 3 years). I call, but the person I'm dealing w/ won't return my calls and I have to keep sending me to other people in his group (who of course, don't have access to all of the info, and can't help me). And of course, I'm dealing with someone from auto insurance, even though it's house damage.
The process drags on, as they had simply mailed me the offer, rather than call me back ... which was incomplete, as it has a note that the hazardous waste removal needed to be bid out. I explained that there was no way in hell I'd accept their offer for ~$8k as it did me no good to have money if I can't get someone to actually fix the property ... and it was a joke. (they said only 60 sq.ft needed to be repaired on the side that got hit, and it could be replaced w/ concrete siding ... even though there was cracked asbestos siding all through that wall)
I had to lawyer up ... and he found me a contractor ... and suggested we take their bid to State Farm. Luckily, I said no way in hell, as I didn't trust it. (it was $12k, but I had estimated that based on State Farm's breakdown, it should've been $15k).
So I'm paying out of pocket to have the contractor do the work ... once he finally got some free time in his schedule, weeks later. And we found he had missed almost $3k in work, as he forgot about the concrete work. Of course, he started just this Thursday ... so now work's halted as everything's buried in 3+ feet of snow (would've been 2, but the plows came and packed it all in) ... and I've been told by my lawyer that I can't claim costs of therapy (as I wasn't at the place when the accident happened), the time off work to deal w/ all of this, or the delays (over $6k in property taxes alone, plus whatever rental profits had been lost).
And when I hang a sign that stays 'FUCK STATE FARM' on the property, I have to deal w/ the president of the town calling me up to bitch, and I have to explain that if he takes it down, it's a first amendment violation. (mind you, the house is across the street from the town hall ... and the driveway to the school board, so I got a few complaints).
So as I see it ... I can only hope that insurance companies like State Farm get screwed by the changes, as they're assholes.
(USAA, on the other hand has been nothing but good to me ... unfortunately, they won't insure a rental property unless it's occupied)
Build it, and they will come^Hplain.
If I have a driverless car that is supposed to be 100% infallible, there should be no reason for me to have insurance at all. If someone hits me with a vehicle that is manual, then their insurance covers my damages, and I can't get in an accident so why would I have insurance?
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
I think the companies pouring billions into this are going to be solely disappointed. It's reminding me of the 1970's when they thought they were a few years away from human like AI.
Laws are rules for the court, but merely a bottom bar to hit for life. Think beyond laws in your actions always.
Because the idea is a dud?
"Transparent" is a shit show that trades on every stereotype going. A man in drag is NOT a transsexual.
The net earnings of a toddler of American parents will be in the tens of millions of dollars.
The first child killed by a driverless car will lead to an immediate lawsuit by the parents.
Parents of children killed by "accident" never give up. Ever.
And almost any jury will back the parents.
No matter what "protections" the driverless car industry "creates" to avoid responsibility for murdering a child.
No matter that killing the child saved twenty people from dying.
That is how it works.
-- Tigger warning: This post may contain tiggers! --
The late night comics are also going to be affected by the driverless cars. As the accidents drop and insurance needs plummet, the auto insurance companies witll out do each other in creating great funny creative commercials. They will suck in all the creative talent. What the late night comics offer will pale in comparison.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
Translation: State Farm plans to spam the fuck out of you, chasing every step you take with coupons and offers and helpful hints and discount offers on vitamins and shoes.
You: walk to your mailbox to get the mail
State Farm: Hey Billy, looks like you're going out today. Did you know we can offer you a discount on home owner's insurance for multiple car households, and did you fully understand and appreciate the paragraph in your policy that cancels coverage for anything we don't feel like paying, and hey here is a coupon for a hamburger and fries!
State Farm: Dear Mr. Billy, careful analysis of your risk profile has revealed areas of concern which will cause us to raise your premium at the next renewal. Specifically, your consumption of a hamburger and fries puts you into a higher risk pool. And your desire to save money on insurance by pursuing multi-policy discounts indicate that you have or are seeking to have extra insurance policies which is a risk factor for loss and fraud. For these reasons your rates are doubling. You can appeal but we don't care. Suck it brother!
State Farm: Hey Billy, have you heard about our multi-policy discounts? Online Agent Ashley, who is totally not the Ashley Comcast uses, is ready to talk to you NOW!
Sig for hire.
Just think of the thousands of commercial vehicles out there - plumbers, electricians, lawn care specialists, etc.. There's no way a driverless pickup truck could do my job. We're not renting a plain truck. There's thousands of dollars worth of stuff attached to my truck!
Would driverless police cars work? Garbage trucks? School buses? Would you want a driverless ambulance to take you to the hospital?
Maybe for you commuters and vacationers it could work. Driving the same route day in and day out could be handled by a driverless auto, but take a look at the real world sometime. It may just open your eyes.
The underlying theory behind insurance is to spread risk as broadly as possible to reduce the cost of being protected. Insurance companies discovered that they can select small low risk slices of the market and treat them preferentially. The result is a myriad of little groups all of whom pay too much, since small groups cannot effectively spread risk very far.
The insurance companies have ruined the great benefit of insurance for the insureds, and have substituted great benefit for themselves.
Don't step on the baby.
they should be fine. People will still own cars, and they'll still be so expensive that you'll need to insure them against loss. The risk involved will drop sharply, as will premiums, but the companies should remain profitable as payouts will likewise fall.
I don't think legal changes will be necessary. The owner of the car will still need to insure it, but against loss if not so much against liability.