Although the automotive industry has seen rapid technological progress in the past couple of years, the study found 70% of insurers are unprepared for the disruption these cars could cause.
The survey of senior insurance executives found skepticism in the short-term potential impact of autonomous vehicles. Few have taken action, with more than eight in ten (84%) admitting they don’t expect autonomous vehicles to significantly impact their business in the next decade, while 42% only expecting the impact of driverless cars to be made within six to ten years.
Jerry Albright, principal in KPMG's actuarial and insurance risk practice, said: "The disruption of autonomous vehicles to the entire automotive ecosystem will be profound, and the change will happen faster than most in the insurance industry think.”
The report also looked at the business areas that will be most significantly impacted by the mainstream arrival of autonomous vehicles, such as underwriting (61%), product management (52%) and claims (52%).
"Technology is making cars safer, impacting underwriting practices, claim frequency and severity as well as auto premiums,” added Albright.
“To remain relevant in the future, insurers must evaluate their exposure and make necessary adjustments to their business models, corporate strategy, and operations."