A panel discussion hosted by Volvo Cars and held in the UK points to huge changes to the insurance industry in that country, while also describing how the industry beyond will transform with the rise of driverless vehicles. The discussion showed there are many lessons for the Canadian insurance industry to learn, especially considering its similarities with the UK market.
Indeed, the meeting held at Thatcham Research Centre on Tuesday may have been focused on the UK insurance industry, but it was a warning to all.
Volvo cited recent data from the U.S. National Highway Traffic Safety Administration that suggested collisions will decrease by 80% by 2035. This will come from fully autonomous vehicles and the result will be a $20 billion cut in the global auto insurance premium market by 2020 alone. This is worth some perspective as 2020 is only four year away and by then self-driving vehicles will be in their infancy, but still able to change the insurance landscape.
Volvo is one of the companies developing autonomous technology and the company says that the insurance industry will have “no choice” but to adapt to the changes afoot.
“But let’s not forget the real reason for this – fewer accidents, fewer injuries, fewer fatalities,” Volvo Cars president and chief executive Hakan Samuelsson said during a seminar in London entitled A Future with Autonomous Driving Cars – Implications for the Insurance Industry. “Autonomous drive technology is the single most important advance in automotive safety to be seen in recent years.”
Canada will be among the country’s to feel the impact first as Ontario is expected to embrace autonomous vehicles early. The province has already allowed companies to test driverless cars on its roads and is likely to be among the first to have cars in showrooms.
Insurance companies in Canada has been urged numerous times to prepare for the changes that AD cars will bring and develop models to cover for the loss of premium payments over the next quarter of a century.