Driverless cars may cut traffic jams, not insurance premiums

Bloomberg

It turns out robots need insurance too. As driverless vehicles reduce car ownership in coming years, insurers may not face the Armageddon that had been predicted, new research shows.
“We do not expect revenues for auto insurance companies to experience a sudden decline as a result of autonomous vehicles,” Alejandro Zamorano, an analyst at Bloomberg New Energy Finance, said. “Instead we expect a gradual shift in the type of auto insurance products as well as new revenue sources for insurance companies.”
That assessment contrasts with previous dire predictions for the industry. A Morgan Stanley report in 2016, entitled “Are Auto Insurers on the Road to Nowhere,” estimated the business could contract by as much as 80 percent by 2040. But as a handful of fatal accidents involving autonomous vehicles has made clear in recent years, insurance coverage will probably evolve, not disappear.
One thing that will change is who pays for the policy, according to BNEF. Rather than individual drivers, manufacturers and technologies companies will be more likely to need coverage, and that shift could be a boon for insurers that are quickest to adapt.
Even if autonomous driving makes the roads safer, accidents that do occur could cost a lot more, by damaging expensive sensors, for example.