Last week was quite a week in the autonomous vehicle world!
First we had Ford announce that it will have fully autonomous cars with no driver’s wheel on the road in just five short years. Then we had Uber reveal it’s going to be testing self-driving Volvos throughout the streets of one major American city this year.
The future is here!
Uber is partnering with Volvo to have upwards of 100 self-driving cars on the road in Pittsburgh by the end of the year. So far only a small handful of these cars are cruising the city’s streets.
Customers can request a ride in these vehicles the way they usually do any time they use the Uber app.
We should note that these vehicles, which technically autonomous, will be supervised by humans in the driver’s seat.
In fact, there won’t be just one person, there will be two! Both will be engineers, according to Bloomberg BusinessWeek; one will be ready to grab the wheel in the event that it is necessary and the other will take notes on a laptop that will later be used to smooth out any bugs.
Here’s a nice bonus that should appeal to penny pinchers: For making yourself a guinea pig for Uber’s experiment, you’ll get a free ride!
The goal ultimately is to replace Uber drivers with fully autonomous vehicles to boost the privately held company’s profits.
Self-driving cars promise to radically lower the loss of life and damage to property that comes about through human error — all of which means insurers will have to find a way to cope with the brave new world of autonomous driving.
What long term impact will self-driving cars have on insurance rates?
The move to an accident-free future has been coming in small increments for many years. Many cars already have collision-avoidance features like blind-spot detectors and front-end crash-warning systems. Next up will be anti-lock braking systems coming standard on every new car within six years.
But the real leap in auto safety will come when self-driving cars begin to take more market share over the next 25 years or so. KPMG estimates the number of accidents could fall by 80% from current levels.
Insurance, however, may take a bit longer to catch up. ‘Even if (driver-less cars) were introduced tomorrow, it will take 20-plus years’ to have enough data to set actuarial tables, Jim Fiske, a senior VP at Chubb, told USA TODAY.
Here’s what an insurance policy for driverless cars looks like
A British insurer is stepping into the great unknown by underwriting what’s being called the first ‘driverless car policy’ in the world!
U.K. insurer Adrian Flux unveiled the driverless car insurance earlier this month in a bid to grab some publicity and have first-mover advantage in this nascent auto/digital insurance space.
‘As [we] continue to invest in driverless research in preparation for the growing market for autonomous vehicles in the near future,’ general manager for Adrian Flux general manager Gerry Bucke remarked, ‘we wanted to help provide confidence and clarity around the ongoing debate of ‘who is liable?”
So what exactly does a policy like this cover? In addition to standard coverages like comprehensive and collision, the Adrian Flux policy protects owners of self-driving cars in the U.K. from the following:
- Loss or damage to your car caused by hacking or attempted hacking of its operating system or other software
- Updates and patches to your car’s operating system, firewall, and mapping and navigation systems that have not been successfully installed within 24 hours of you being notified by the manufacturer
- Satellite failure or outages that affect your car’s navigation systems
- Failure of the manufacturer’s software or failure of any other authorized in-car software
- Loss or damage caused by failing when able to use manual override to avoid an accident in the event of a software or mechanical failure