What Does The Future Of Car Insurance Look Like?

Ever wondered how cars are becoming more advanced and safer? As the safety features of cars increase due to different technologies that are coming to the automotive industry, almost every company that provides insurance in Frederick, MD,  has to adjust its policy guidelines.

As the tech world is advancing, cars are becoming safer. The safety element available will increase even more in the future. With these safety elements, cars will become safer, and insurance companies will be less concerned about safety concerns with insureds driving. In the long run, it is predicted that accident prevention technologies will make cars safer. 

Let’s explore some of the upcoming technologies and the effect they will have on the auto insurance sector!

Upcoming trends to be on the lookout for:

Telematics: Telematics has already been in use for some time now and it is used in traditional tracking techniques through the drivers smart phone or plug-in to assess drivers’ driving skills and mileage as it generates data about the car’s speed and location.

V2I: V2I or Vehicle to Infrastructure connections will enable cars to interact with infrastructures like traffic signals, signs, and parking meters. This will help the driver know when traffic lights are going to change or when there is a safe parking option.

V2V: Vehicle-to-Vehicle connectivity will enable the cars with technology to interact with each other. As the streets get more crowded, V2V connectivity will make sure that vehicles pass each other information like the speed and directions and assess that information to prevent vehicle collisions.

Vehicle-to-pedestrian: Vehicle to pedestrian connectivity will lead the vehicles to assess the streets to prevent collisions with pedestrians attempting to cross the roads or even the nearby cyclists.

AI in Cars: There is a very good chance that in the near future, cars will be AI-enabled to prevent accidents. The dashboard will be displayed on the windshield and the car will sound an alarm notifying the driver of a potential accident. Leaders in the AI developing industry are already making attempts to incorporate artificial intelligence in cars.

So, How will these technologies affect auto insurance?

The safer cars are, the less catastrophic accidents there are, this lowers the premiums in the market. With better technologies, insurance premiums could start to go down. But, As cars become safer, the expense of repairs will increase. Smart car parts will not be cheap when there is an accident. The technology in the car will be expensive to replace or repair if it is damaged in an accident. As seen with the supply shortages in 2021 and 2022. When parts like computer chips are in short supply, it increases the cost of repairs and increases the cost of insurance. 

So, we have the prediction that cars are going to be safer and more efficient. But, at the same time, the occasional accident these cars might get in may be expensive to repair. This will directly impact the way policies are designed.

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