Volvo has warned insurers to prepare for a period of change that will come with the introduction of driverless vehicles on UK roads. The motor vehicle manufacturer predicts that by 2021 we could have a number of autonomous cars on our roads, with likely widespread adoption expected over the next decade.
Håkan Samuelsson, Volvo’s chief executive has suggested that driverless cars could lead to an 80% decrease in car crashes by 2035, which is expected to have huge ramifications for the car insurance industry.
Despite car crashes still being an everyday possibility, even with the introduction of driverless vehicles, it is predicted that the impact will be reduced – due to automatic crash avoidance systems that will come into play during an unavoidable collision.
As a result of the reduced risk to drivers, many experts are predicting that insurance premiums will be significantly reduced.
Samuelsson said: “Volvo believes the insurance industry will have no choice but to react to these seismic challenges to its existing business model by fundamentally restructuring – or face competition from new entrants into its market from technology-savvy disrupting companies.”
Volvo is set to trial its new driverless car technology in Gothenburg, Sweden later this year. The Swedish carmaker is expecting to start selling vehicles equipped with this technology in 2020.
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