The beauty of advancing technology is that it often brings us faster, more efficient ways to conduct our daily lives. Now, as Google tests prototypes for driverless cars, we might even be safer on the road in the future. And in the insurance world, safety usually translates into lower auto insurance rates.
At current time, prototype cars only reach maximum speeds of about 25 miles per hour. They’re equipped with sensors which “see” about 600 feet in all directions, and the front end will be fitted with a foam-like bumper in case the sensors somehow overlook a pedestrian. Obviously these early driverless cars would not be fit for freeway use, but could be a terrific solution in busy downtown areas or on college campuses. Owners could even use their smart phones to summon the vehicles.
We’re still years away from actually seeing driverless cars on the road, but the insurance industry is already making predictions about how the technology might affect auto insurance rates. According to one study, accidents could drop by as much as 90 percent if driverless cars prove to operate the way they are intended. Increased safety and lower risk of damages translates into lower auto insurance premiums – but how much lower?
Rates would depend upon the use and comprehensive auto insurance rates could drop by about 30 percent. By 2022, liability rates could drop as much as 60 to 80 percent, depending upon how technology advances.
Aside from the possibility of lower auto insurance rates, driverless cars could mean huge changes for some people. Those who are unable to drive due to disability or age, for example, would enjoy greater mobility and texting while driving could be a problem of the past.
Of course, these numbers are all theoretical at the moment. None of us will be rushing out to purchase a driverless car tomorrow, but it’s always a good idea to keep an eye on the future.
For more information, see: http://www.foxbusiness.com/personal-finance/2014/06/11/will-driverless-cars-fuel-cheap-insurance/