Driverless cars will significantly impact the insurance market over the next 5-10 years. Premiums will steadily decline as automation makes cars safer and reduces personal liability. However, the costs of autonomous car parts and software protection will offset some premium reductions. Insurers will need to offer new products and aggregators may need to adapt online offerings to handle niche underwriters. While personal car ownership could decline, opportunities exist in areas like car aggregation, software protection policies, and specialized coverage for early adopters of autonomous vehicle technology.

1. “What impact will driverless
cars have on the insurance
and aggregation markets?”
Charles Burrows

2. Backdrop & trends
Impact on customers & insurance products
Opportunities
Zoom in on car product (homepage & quote engine)

3. Backdrop, trends & timelines
Premiums will steadily fall
for the majority, with
increased automated
driver features over 5-
10yrs, increased safety and
decreased car ownership
and personal liability. In
addition, market
consolidation may bring
aggregator profit under
further pressure.
Automation will probably
never mean zero driver
intervention and will
remain optional to switch
off. Autonomous car parts,
replacement costs,
demand for software
protection will rise and
offset some premium
decline.
Threats
Opportunities

4.  Premiums will reduce / become even more competitive
 Market competition / consolidation will increase
 Aggregators’ online products may need to adapt to handle:
 Niche and new underwriters & products to bring online
 Legal change (e.g. changes to T&Cs on site)
 61% of insurers expect to offer new and different personal
car insurance in the US to adapt to the changes:
What is happening to Insurance
Products?

5. Black boxes
Why?
•Trend is for growth as overall cars get safer and more cars will have
black boxes fitted as standard. Premiums lower.
What?
•Young drivers choosing to save money on premiums.
Product
Capability
•Sell Black Box harder in quote results if cheapest result over a
certain amount. As safety increases, the default insurance type in
results may change to 3rdParty (currently comprehensive).

6. Car Software/Security protection
Why?
• Additional cross-sell that hasn’t been a liability until now.
Complex, valuable and costly to maintain/fix if you own a car.
What?
• Additional annual or monthly fees give protection to higher-
tier customers from hacking, identity theft, malware etc.
Product
Capability
• Need to aggregate feeds from insurers, house new product
facets and filters.

7. Car aggregation
Why?
•Shared ownership trend set to continue. Also, mitigates any loss of
revenue to reduction in overall car pool/personal cover.
What?
•Annual or monthly fee includes combination of personal and vehicle
liability dependent on level of autonomy, as well as freedom to an
amount of car use per month.
Product
Capability
•Aggregated feeds from manufacturers (e.g. Google or Ford), not
insuranceco’s, and also contain car model specs that need surfacing
online.

8. Automation switch-off
Why?
•Looking 25+ years ahead, near- or fully-autonomous car drivers
might want to simply turn off the automated driver and take the
wheel for fun.
What?
•Product option to allow cover specifically for when the driver
wants to switch off all or part of the driverless features.
Product
Capability
•Automation “switch-off” feature filter in the search engine.

9.  Homepage “step-by-step guide to the key factors which affect
your quote”
 Mileage: would not be as relevant to customers in a fully-
autonomous car world as personal liability will cease.
 Share of miles completed with the driverless function active will
reduce the premium further.
Features & guides will need re-imagining

10. Quote & results engines
Telematics checkbox
will not be optional in
near- or fully-
autonomous cars.
Fewer providers in
an increasingly
autonomous world.
…Additionally, shared vehicle access and
manufacturers’ autonomous vehicles might
be profitable and achievable to offer via
aggregators.

11.  Sources:
 BBC.co.uk, Axa website, Telegraph.co.uk, AEI.org, UK Govt.: Pathway to Driverless Cars,
KPMG: Automobile Insurance in-the Era of Autonomous Vehicles
Summary / Q&A
 The eCommerce product will need to adapt to changing
insurance suppliers and products, and some big changes
in personal ownership/liability.
 There are opportunities in:
 high-tier segments like early-adopters
 increased cost of autonomous car part replacement (incl.
software)
 increased safety/low-premium shift
 and in adjacent vehicle ownership aggregation which the
product may need to support.

12. How will increased autonomy affect
customer types?
Mainstream: Lowbut increasing use
of automation in mainstream cars and
still pay premium for personal liability,
e.g. majority of regular drivers
Traditional: Riskier, less automation,
happy to pay premium, e.g. classic car
drivers, performancecars or ones
designed for manual driving.
Early-adopters: Near-fullautomation
(~5-10 years?), affluent/high-earners
on lease, higher premiums for higher-
value cars due to new technology
Young & Old: Super-
safe,adopt automation where it
reducespremium or take shared
ownership.
Customers in the
automated world

13.  Why? New, high-tier product set for affluent early-
adopters will be required because the initial tech will
come at a premium, and replacement parts will be
more expensive than average.
 Look and feel of website and UX will need to connect
with those customers.
Affluent early-adopters