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Will Self-Driving Cars Destroy The Auto Insurance Industry?
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westrock2000
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I haven't heard many people make a realistic argument that we should NOT have a great medical system in this country. Personally I feel being healthy should be a perk of living in the greatest nation on the planet.
The main issue, amongst conservatives and Republicans, is the method in which it has been implemented. By virtue of being alive you are forced to either purchase a product from a private company or pay a tax (supreme courts words). I think you would be hard pressed to find any other tax that you must by pay by virtue of being alive.
Ag
Comprehensive should increase if you own more than one vehicle. What happens if you drive one of your twenty cars into another and total both of them? What if there is a gas leak and one car destroys all of your cars? What happens if all of them get broken into or stolen simultaneously? The risk for the insurance company is greater, so your cost for insurance should be greater.
Totally agree with your main point, partially disagree with this off topic point. Agree that collision insurance should stay the same regardless of the number of vehicles you own, since that essentially covers the driver.
Comprehensive should increase if you own more than one vehicle. What happens if you drive one of your twenty cars into another and total both of them? What if there is a gas leak and one car destroys all of your cars? What happens if all of them get broken into or stolen simultaneously? The risk for the insurance company is greater, so your cost for insurance should be greater.
I really don't think health insurance companies have much to worry about for the foreseeable future. Obamacare is one of the best things to happen to them, making it mandatory to get insurance or get a fine. Plus lifespans are actually going down among the poor. The health insurance industry is going to be very profitable for a long, long time.
Every time we have a self-driving car discussion, this silly false dichotomy comes up.
Why must the car hit the child or die in a crash with an oncoming car? Couldn't the self-driving car pull into the lane the oncoming car pulled out of? Couldn't it signal the oncoming car to return to its own lane? Couldn't it plot a course that misses the child AND the other car (even if it ends up in a ditch)? And what about self-driving cars makes them more prone to these sorts of false dichotomies, rather than the non-self-driving cars operated by distracted, limited humans?
After all, in the time it takes your inferior carbon mind to recognize the peril you are in, the superior electronic being has recognized the threat, plotted at least 4 ways around the situation, and executed the most likely path to avoid all problems. Welcome your robotic masters, meatbag. It's your only hope.
In addition to the other replies, my thought is that eventually, you'll have to manually drive cars either in VR or in a tightly controlled track. From home to work, I'd expect that your car will be automated, and there will be no steering wheel at all. Of course, if some models of traffic flow are correct, you couldn't safely drive even if you had the controls, because you just can't react fast enough to the sort of situations you might find in self-driving cars (no traffic control signals because cars are routed past each other through intersections).
The answer to the question is... Absolutely yes. The auto insurance industry will crumble under this.
In a given city, you have 50+ incidents daily. With automated cars do you think it will get anywhere near that? No way, no how. I don't care what other circumstances you bring into the picture - such as disaster (tornado, hurricane) or theft... You won't get anywhere near as many incidents, and ultimately it will prove how worthless the auto industry is. I hope to see it fall. I really do.
In a given city, you have 50+ incidents daily. With automated cars do you think it will get anywhere near that? No way, no how. I don't care what other circumstances you bring into the picture - such as disaster (tornado, hurricane) or theft... You won't get anywhere near as many incidents, and ultimately it will prove how worthless the auto industry is. I hope to see it fall. I really do.
Darunion
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Every time we have a self-driving car discussion, this silly false dichotomy comes up.
Why must the car hit the child or die in a crash with an oncoming car? Couldn't the self-driving car pull into the lane the oncoming car pulled out of? Couldn't it signal the oncoming car to return to its own lane? Couldn't it plot a course that misses the child AND the other car (even if it ends up in a ditch)? And what about self-driving cars makes them more prone to these sorts of false dichotomies, rather than the non-self-driving cars operated by distracted, limited humans?
After all, in the time it takes your inferior carbon mind to recognize the peril you are in, the superior electronic being has recognized the threat, plotted at least 4 ways around the situation, and executed the most likely path to avoid all problems. Welcome your robotic masters, meatbag. It's your only hope.
There inevitably will be a scenario that can't work out. You have to be able to program it to prioritize. You can't have it just end up in a loop where it just can't resolve it because it is programmed to preserve life. The point is really that the scenario would happen less often but since we don't have artificial intelligence we have to program it to react.
westrock2000
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It is not a false scenario, it a very real scenario that gets played out by humans all through out the world. However, as humans we understand that humans are not amply suited to make those kinds of decisions in that short amount of time and so we accept that whatever happens happens and is up to the free will of those involved. We just hope for the best, but understand that probably won't be the case.
But a machine does not have free will. It very much follows a flow chart of logic developed by a person sitting at a computer. So when that car follows a decision we know that the car did not make the decision, a human made a calculated decision that resulted in whatever happened. I assure you, people will want to know why that decision was made.
Someone made the assertion in this thread that driving is a trivial matter. It is not, it is a very complex operation with a lot of sensory input at any given moment.
Last I checked, a hurricane can come through, plow through one garage (but not the other), hence only damaging one of the two cars (or both).
I'm not sticking up for insurance companies, but that does... well.. kind of make sense?
westrock2000
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It's a valid point, I have also wondered why home owners insurance will cover everything in the garage except the automobiles.
how is a car sitting in the garage different from the lawnmower? Outside of the obvious cost.
What if someone runs into your parked car and drives off? This has happened to me three times in the last year by the way. What if someone runs into several of your hypothetical cars while they are parked? What if your gigantic garage with your 20 cars catches on fire? I'm no fan of the insurance industry, but they are assuming more risk by insuring multiple vehicles, even if you can't drive them all at once.
sirmonkey1985
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agree other than the trusting technology to always work part, while it's nice to have it there as a guide it's not something you can use in court when you end up side swiping a car and saying "but the indicator didn't say there was a car there", lol..
the other thing is that humans are very much about status symbols.. so while sure maybe the industry will slow down a little bit, people buying new cars just because it's the new cool thing will never end. also this question is being asked probably 30 years to soon. but companies need to realize that they can't stop the future and whether they like it or not this is the route it's going.
as far as insurance goes, that shit will never change, they'll always find something else to rip off their customers for.
B00nie
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All insurances are based on cheating. They will just invent another 'carless driver insurance' and lobby to have it mandatory to all cars. Problem solved.
Except someone driving a large truck without insurance could take out all your cars at one time, even though they are parked in your driveway.
Home insurance covers your home. Car insurance covers your car. Do you expect your car insurance to cover your home?
In the case of cars that are not driven at all, some insurers offer insurance that more properly covers the sort of damages an unused vehicle may suffer.
I was talking to my co-workers a while back about all the cars that have those indicator lamps on the mirrors indicating that someone is next to you.
These are becoming very common place now. Well imagine in 10-15 years when the cars on the road now start experiencing failures. Either with the light indicator or the sensing system. People will have become so used to these always working that the light won't be on and they will just merge right in to someone.
I'm kind of the same way with my spotter mirrors. I don't even look back anymore because I am so confident in my spotter mirrors (to the point I feel sligtly uncomfortable driving a car without them).
I'd say that would be more down to owner negligence, the self diagnostic system on my GTI will tell you the second a single light bulb is blown.
Cars won't be programmed to save lives. They'll be programmed to drive properly. Saving lives will merely be the side effects of a successful program to drive the car.
Yes. Really it is. And it's silly, too. Just like the car full of babies vs. car full of nuns examples that keep cropping up. And furthermore, driving is not trivial for humans, simply because we are not optimized for the sorts of tasks driving entails. For an autonomous car, however, it will be far different, and far more trivial. While you're distracted by the cell phone in your pocket and the hot babe|dude in the car next to you and the need to pick up milk and the car inching up to you on the left which draws your attention from the small human playing on the road on the right, the autonomous car doesn't care about the hot dude|chick passenger, can handle the cell phone and milk issue with another CPU core, and is fully aware of both the car on the left and the small human playing on the side of the road on the right. Perhaps it slows down. Perhaps it changes lanes to avoid the car on the left. Perhaps it swerves exactly 20 degrees to the right to avoid both the car and the child, while doing controlled braking. And perhaps its AI is doing calculations on all of these outcomes in the time it takes the signal to travel from your eyes to your brain, be processed in your brain, and a panic response sent to your arms and legs, causing you to make a much worse decision in a panicked moment than the car would ever make.
These scenarios are merely thought exercises, and not really good ones at that. Self-driving cars have driven millions of miles now, with accidents being minor fender benders caused by human drivers that expected the self-driving cars to not follow the rules of the road (this is telling in its own right -- many accidents are caused by people failing to yield when they should, or executing poor driving decisions that violate the rules of the road). We've not yet seen a serious accident with an autonomous car, and according to Google, their vehicles have amassed 1.5 million miles of self-driving distance, with only a single AI faulted accident. While there are still kinks to work out (the bus accident in February), self-driving cars are already proving that they are safer than human-driven cars. As we get more experience for the AIs driving these cars, they'll get even safer. I'm looking forward to fewer jump-scares as stupid people end up driving less.
Nenu
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One of the major benefits of insurance is that the person paying does not want to have their wallet emptied and suffer impaired life/guilt so will learn by their mistakes and drive safely.
This element could be entirely removed if the vehicle manufacturers (or software devs) are not made to pay the insurance while the car is in motion.
The vehicle manufacturer essentially becomes the driver.
If they are not made to pay the insurance then they have much less of a vested interest in making sure it is completely safe.
Thats not to say that they wont have a duty of care or a wish to have their product look good, but their liability is vastly reduced, as will their interest in perfecting the product.
Granted its not likely that driving insurance is going to fall on the mfrs heads, especially as many countries are making it law that a human must be at the controls at all times to take over.
But the chance of a bored driver -doing nothing except monitoring- being distracted is extremely high, especially when doing nothing becomes the norm.
Its going to be a can of worms. A major part of the liability for an accident while in motion needs to be placed on the mfr.
Especially if negligence is found in the code or use of mechanical systems.
Laws will need to be changed to open up the software development procedures to scrutiny, they cannot be hidden behind a veil of secrecy.
Either this or many needless deaths will occur and there will be a collective shrugging of shoulders.
In the interests of safety it might be better if the code is open source, but that can also blur the lines of liability.
Big can of worms.
When the first major injuries or deaths occur is when liability and law will get their first test in court.
This element could be entirely removed if the vehicle manufacturers (or software devs) are not made to pay the insurance while the car is in motion.
The vehicle manufacturer essentially becomes the driver.
If they are not made to pay the insurance then they have much less of a vested interest in making sure it is completely safe.
Thats not to say that they wont have a duty of care or a wish to have their product look good, but their liability is vastly reduced, as will their interest in perfecting the product.
Granted its not likely that driving insurance is going to fall on the mfrs heads, especially as many countries are making it law that a human must be at the controls at all times to take over.
But the chance of a bored driver -doing nothing except monitoring- being distracted is extremely high, especially when doing nothing becomes the norm.
Its going to be a can of worms. A major part of the liability for an accident while in motion needs to be placed on the mfr.
Especially if negligence is found in the code or use of mechanical systems.
Laws will need to be changed to open up the software development procedures to scrutiny, they cannot be hidden behind a veil of secrecy.
Either this or many needless deaths will occur and there will be a collective shrugging of shoulders.
In the interests of safety it might be better if the code is open source, but that can also blur the lines of liability.
Big can of worms.
When the first major injuries or deaths occur is when liability and law will get their first test in court.
M76
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Science is not religion. However the dogmatic hate and denial of what science can offer, is similar to faith. So the irony is strong with you.
NeoNemesis
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If you had good enough communication between vehicles, you could potentially avoid this situation by having BOTH (or even more) cars react accordingly.
fadedlogic
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Actually, Health Insurance companies are in trouble since the "Affordable" Care Act completely undermined the underpinnings of insurance by sending a nuke into the actuarial data(scary accurate) which Health Insurance Companies utilize to base their rates. Healthy 20 somethings are a "good risk"; 48 year old obese, no exercising, smoking, drinking, drug abusing haven't seen a doctor in 15 years folks are a "terrible risk". The ACA forced a ton of these folks into the insurance Risk Pool which was not nearly deep enough to sustain the claims made against it. That's why most employed folks will see another significant increase in their health insurance premiums, likely in the double digit range, this year. Other sectors of the Insurance industry are absolutely flush with cash with tons of capital being invested because of the lack of volatility.
Technology has already significantly reduced injuries in MVA's; 3 point seat belts, crush zones, supplemental restraint systems(airbags[unless they are Takata]), anti-lock brakes, pre-tensioning seat belts, improved tire compounds, traction control, blind spot monitors, improved trauma medicine practices; to name just a few. Many of this technologies are available in the most basic of entry level vehicles in a majority of first world countries. The big hurdle that autonomous vehicles need to overcome are the poor conditions of most US roads. A well maintained highway is quickly becoming the exception. Look how far smart phones have come in less than a decade.
As pointed out early the switch will come with the insurance following the vehicle rather than following the driver. Unfortunately, this will require updates to legislation, motor vehicle codes/statutes, and tort reform. Shockingly, the legal bar can be a huge hurdle to innovation as it can cut into their revenue streams.
Now I'm going to day dream about how awesome it would be catch up on my reading as my vehicle drives me home from work.
DukenukemX
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I wouldn't put money on that. Much like how the oil industry was struck with cheaper oil because of fracking, so too will the health insurance industry have to deal with a changing market. The market will respond. People get sick because people get older. Fix that, and a lot less people need health insurance.
The technology to do that isn't around the corner, but it isn't too far away either. WIthin the next 14 years, the health insurance industry will face trying times. Remember, America doesn't live in a bubble. Other countries who have Universal Health Care have to contend with an ageing population that's costing them money. As for car insurance, I'm sure they'll lobby their way, but they'll also have to lobby against Google as well. Google isn't the only company who wants their self driving cars on the road.
I'll believe it when I see driverless cars properly navigating the busy downtown streets full of jaywalkers and cyclists who don't obey any of the cycling laws. I think they might have to change the laws to favor motorists like they are in Europe before they'll ever be able to get these things legalized.
Lets say you own 20 cars, you can only drive 1 at a time, but I can knock the building down and crush all 19 left while you are away. So you don't want those replaced then?
The medical system in this country is great. the problem is we have a segment that can't afford it. Within that segment is a bunch off legitimate inability to afford it and some are deadbeats who can't afford it and some prioritize other things or commit fraud. All but the first are cause for heartburn
Was anything done to address cost. Nope.
The solution appears to fuck up the system and compell people to pay more taxes and de facto taxes to include more people with coverage. Now if we just cut people tax credits to buy into the existing system, it wouldn't have cost anything more than it will cost when it goes into full swing and taxes would still go up, but it wouldn't have fucked up the actual quality of care. Then we could methodically and carefully focused on costs starting with lawsuits.
westrock2000
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Single payer system seems to be the way that's worked the best so far for countries that have tried. But there is a label...a word...that follows that plan, and it's a label that most politicians are scared to death to say in public. Once the American public openly acknowledges they want, at least parts, of that label then we can do stuff like single payer. The system that we implemented left in capitalism, because that's the answer you are allowed to say. Each side has pro/cons, we haven't discovered utopia yet.
fadedlogic
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The ACA actually is driving Insurance companies out of the health insurance business Justin Haskins - New Report: Insurers Leaving Obamacare Exchanges in Droves. Insurance still works basically the same as it did when the Lloyds of London founded in a coffee house back in 1688. More on how insurance works How Insurance Works. Insurance is only as good as its diverse policy holder pool; introduce a large number of adverse risk; poof - bankrupt insurance co.
I REALLY am not betting on fountain of youth technology to affect much except for the very wealthy. People don't just get sick because of age, they also get sick from malnutrition and environmental toxins. The middle class is disappearing and our infrastructure is falling apart. If you're lower middle class or below in the USA, your lifespan expectancy is currently going down.
That is a valid argument, although I would counter that saying insurance companies will do their absolute best to deny coverage wherever they can. It's practically a stereotype of how many loopholes there are in insurance policies to allow them to deny coverage to clients. This an industry with its hooks DEEP into government and the economy as a whole. When you have that kind of influence, you can manipulate the market to keep you going. Just look at the banks!
The old Car Insurance industry will crumble.
There may always be car insurance, but rates will have to shrink by up to 10 times, decimating bloated car insurance companies based on earning 10X the revenues.
They can't just refuse to lower their rates, or new entrants will step in an undercut them.
It will be a bloodbath for the incumbent car insurance industry.
I doubt there will be many tears shed outside the industry.
There may always be car insurance, but rates will have to shrink by up to 10 times, decimating bloated car insurance companies based on earning 10X the revenues.
They can't just refuse to lower their rates, or new entrants will step in an undercut them.
It will be a bloodbath for the incumbent car insurance industry.
I doubt there will be many tears shed outside the industry.
the big problem I see will be software updates. the systems "learn" as they go. I suspect some change may result in unforseen consequences and then mass casualties. They will need to figure out how to prevent stuff like that - stuff that happens regularly in the software world
DukenukemX
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Once a technology is created that people want, it's really hard to create a flood gate to control it. Smart phones are a good example. As much as Apple wants you to believe a proper smart phone costs $700, in reality there's plenty of good smart phones for $100. Hence why Steve Jobs wanted to go thermal nuclear war against Android.
I predict that within 3-4 years we will hear about this technology actual working, cause it isn't at the moment. It only works on mice, hence the problem. As for income, that's another subject. But I'm willing to bet that governments around the world would give away this technology to stop spending money on health care.
Self driving cars will destroy the insurance industry. Even if you're driving the car, the AI computer can monitor you and take control if you're about to get into an accident. You can still be in control, up until the point you're about to crash, which the AI computer takes over. I'd put this in my older cars if someone makes a kit. Car insurance will exist, but for a very minor market. Like for those with older cars, or with luxury expensive cars.
rudy
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As others mentioned there will still be insurance the safer driving is overall the more money insurance companies will make think about this. For an insurance company that charges people thousands per year for insurance, what really kills them is when a major accident happens especially one involving and ER visit or death. If the cars simply get better at avoiding all this then the big ticket payouts reduce and the small items that are very predictable and there for easy to make money off of become a larger percentage of their profit. That $10 billing charge is now a stable source of income lol. Won't be surprising to me if self driving cars turn the weather into the biggest annoyance for insurance companies. Insurance rates will go down, they will probably hire less people, but the companies themselves will still be plenty profitable. So for most its just a big win.
Of all the accidents I and my family have ever been in, I can only think of 2 that self driving cars would not have fixed, both were heavy snow conditions. All the other ones were the fault of distracted or careless human drivers either my family member or someone in another car doing something stupid. I really am for self driving cars because I think they can make the roads and our lives immensely better in so many ways. And it is amazing to see how many people are so against change that has the possibility of being so positive. Read through this document if you have any doubt about the possibilities for improvement in self driving cars
http://www-nrd.nhtsa.dot.gov/pubs/812115.pdf
The nuts and bolts of it are this, 94% of all car accidents were caused by drivers. So why are we all working so hard to defend the drivers? And only 2% of these are due to environment, if machines are going to make mistakes you would think they would be most likely to do so because of environmental conditions. In order for machines to be worse than drivers they would have to be so bad that they would increase the rate of accidents for other factors by 2000% And so far we don't seem to have any indication that self driving vehicles are that bad even in their infancy they seem to be as good or better than humans already.
Lets say that you don't trust autonomous cars in bad weather, even then if they can be flipped on during good weather and off during bad weather they would still reduce accidents a ton.
Of all the accidents I and my family have ever been in, I can only think of 2 that self driving cars would not have fixed, both were heavy snow conditions. All the other ones were the fault of distracted or careless human drivers either my family member or someone in another car doing something stupid. I really am for self driving cars because I think they can make the roads and our lives immensely better in so many ways. And it is amazing to see how many people are so against change that has the possibility of being so positive. Read through this document if you have any doubt about the possibilities for improvement in self driving cars
http://www-nrd.nhtsa.dot.gov/pubs/812115.pdf
The nuts and bolts of it are this, 94% of all car accidents were caused by drivers. So why are we all working so hard to defend the drivers? And only 2% of these are due to environment, if machines are going to make mistakes you would think they would be most likely to do so because of environmental conditions. In order for machines to be worse than drivers they would have to be so bad that they would increase the rate of accidents for other factors by 2000% And so far we don't seem to have any indication that self driving vehicles are that bad even in their infancy they seem to be as good or better than humans already.
Lets say that you don't trust autonomous cars in bad weather, even then if they can be flipped on during good weather and off during bad weather they would still reduce accidents a ton.
Darunion
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I think drunk driving stands to be potentially reduced drastically. If it can detect bad decisions and override (which it could deduce from where you are and what time etc) and take you home, I think that would be amazing in itself.
Well all I can say is you have an incredibly more optimistic view on both technology distribution and government not protecting the interests of the wealthy than I do. I mean in the USA, what's the big barrier to us having Thorium reactors? Better railway systems? More accessible health care? More affordable internet? Not having data-capped internet? It's certainly not the lack of technology. While I'm still incredibly skeptical that we'll see dramatic life-extending technology in our lifetimes, I find it even more implausible that this technology would be used in ways that benefit everyone. I would never underestimate the ability of large companies to profit off of something, at any expense.
Darunion
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hell, how about better asphalt for roads that doesn't need replaced yearly lol, let us start there. We really don't do things better in america anymore, we do things cheaper and faster. We are like our own chinese knock off. lol
I was in a single payer system. Leaving that behind is partly why I moved to the US. Single payer is fine for the small shit probably more efficient because they cold cock lawsuits. But for the serious shit, you will suffer. Single payer systems use waiting lists to ration care. Not only is the a chance you may not make it to the care you do need, if you manage to last you suffer unnecessarily with the illness and it probably has taken a permanent toll on your quality of life for the rest of your life.
NO THANKS, I'll take the small chance of bankruptcy.
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