Claims Journal: Autonomous vehicles to change insurance industry
Autonomous vehicles are changing the future of claims and with it, the insurance industry, according to a recent article by Claims Journal.
“Understanding automotive solutions means staying agile in the face of rapid industry changes, analyzing claims cycle times, addressing emerging issues, and keeping pace with the evolving technology that’s steering the future,” the article says. “As autonomous vehicles take over the roads, they bring both promises and uncertainty into the automotive industry.”
The article points to a study published in The American Journal of Comparative Law in 2022, which found that autonomous vehicles result in minimal claims compared to human error, which is the cause of 90% of collisions.
While consumer trust remains low, at about 13%, it is likely to continue to grow, making it an important issue to monitor, the article says. Advancements in liability, claims processes, and risk strategies will be key as the landscape evolves.
The article claims that ADAS is already playing a role in reducing crashes and claims.
“As roads become safer through the adoption of ADAS and emerging autonomous technologies, the auto claims landscape is shifting in powerful ways,” the article says. “From the insurer’s perspective, the steady decline in accident frequency means fewer claims are rolling in —giving companies and claims administrators the opportunity to focus more on the quality, speed, and innovation in the claims process itself.”
Companies can use the time to invest in smarter claims handling, faster resolutions, and enhanced digital tools, the article says. It adds that lower loss ratios allow insurers to redirect resources toward improving customer experience and developing more flexible, tech-driven coverage models.
“At the same time, drivers’ experiences on all fronts can improve,” the article says. “With fewer accidents and smarter vehicles, drivers gain the peace of mind that their car is looking out for them and helping avoid incidents before they happen. And if something does go wrong, today’s claims experience is faster, more transparent, and more supportive than ever. Drivers get the relief of safer roads combined with the confidence that their claims provider is ready to assist quickly and fairly.”
The article also says that as vehicles become more autonomous and software-driven, the nature of automotive claims is shifting with liability moving away from the individual driver and toward manufacturers, software developers, and third-party providers.
“In accidents involving these advanced systems, fault may stem from AI malfunctions, sensor failures, or software issues, introducing a more complex claims landscape,” the article says. “Handling these claims will require in-depth analysis of vehicle data and technical expertise to determine liability accurately.”
Ajit Jain, Berkshire Hathaway’s vice president of insurance, and Warren Buffett, chairperson, addressed the changing landscape of liability during their annual meeting in May.
Jain said GEICO is already working on a switch from providing insurance for operator error to an insurance that focuses on “errors and omissions” made during the manufacturing of the vehicle.
“There’s no question that insurance for automobiles is going to change dramatically once self-driving cars become a reality,” Jain said in response to a question about autonomous vehicles and insurance during the meeting.
The Claims Journal article said Insurance models are also evolving to become more vehicle-centric and tech-focused, including usage-based insurance or manufacturer-backed coverage.
“As this shift continues, claims professionals and regulators must work together to create clear frameworks that ensure fair, efficient claims resolution in a world where the ‘driver’ may no longer be human,” the article says.
Threats like hacking, software manipulation, and data breaches could also become a risk that presents new challenges for insurers and manufacturers.
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