The Future: Car Insurance 100 Years From Now

After reading the BBC’s 100 Years From Now article, I started to think about what would the car insurance industry look like 100 years from now. I eventually asked myself the most damning question of all “Would we even have car insurance?”

And the answer is not likely.

Driver-less Cars

Why? Well Google in particular is leading the charge on driver-less technology which as the name implies, allows vehicles to drive by themselves. In fact, Google claims the driverless cars they have been using have driven over 1,000 miles with a goal of reaching 1 million miles. Ironically, the only accident that did occur was when a Google car was being manually driven.

Let’s fast forward to the year 2012, think about how good this technology will be? It will likely be in every single car regardless of price. For the reason that in the next 10 years is when the early adopters (i.e. rich) will enjoy the benefits of driver-less vehicles. It would likely to another 20 years for the technology to trickle down and in a hundred years it will likely be perfected and assumed as a normal way of life.

So if all cars are controlled by computer algorithms which ensure a safe trip 100% of the time, this would also mean that their would be no more car accidents. This would be a major advancement for humanity as we will be able to prevent at least 1.2 million people around the world from dying in car accidents annually.

A World With No Car Accidents?

However the economic implications of a world with no car accidents, would also mean that we don’t need car insurance anymore. I believe as driver-less vehicles are introduced to the public within the next 5 to 10 years, insurance premiums will start to go down. Actuaries will notice that drivers are not getting into accidents as much and will have to lower premiums. Of course, it will not be a smooth transition and it will in fact get ugly as any old system being replaced with a new one is going to go down fighting. I expect the government and large public outcry within 30 to 40 years from now demanding that insurance rates go down as less and less accidents are occurring.

Car insurance companies will likely not become completely non-existent as their will still be need to be insured to cover things such as theft, vandalism, acts of nature and accidents caused by computer malfunction. But it is likely those issues will also be solved or at least partially solved. It’s getting easier and easier to track stolen items. My iPhone in particular allows me to track it and lock it remotely, if someone steals it. I imagine all vehicles will have a similar feature 100 years from now. Even vandalism wouldn’t likely be a problem as scratch resistant paints improve. There is even a new product called Neverwet that creates a superhydrophobic coating preventing any material it is applied to from having water or anything stick to it. It’s not hard to imagine cars being sprayed with this stuff in the next 2 years.

Aside from the car insurance industry going through major changes as result of driver-less cars, other industries such as auto body shops, private investigators, doctors, chiropractors, and bodily injury lawyers will see a dramatic decrease in business as less car accidents means less damaged cars and less injured people. What’s even most saddening is sites like ours will also seize to exist.

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