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Auto insurers mining data to develop ridesharing and autonomous products


Insurance companies have been working tirelessly to develop products that meet the unique needs of the automobile-sharing economy, exemplified by ride-sharing services like Uber and Lyft or car-sharing services like Zipcar or Turo. But as carriers work to innovate in this area, many are finding that the macro issues around risk ownership and liability are aligning with another trend that threatens to shake the industry to the core: the driverless vehicle.

The leading ridesharing companies are clearly preparing for an autonomous future along with insurers, tech firms and automakers. In November, Uber agreed to purchase 24,000 autonomous vehicles from Volvo to be delivered by 2021. Lyft also began offering autonomous vehicle rides in Boston in December, The Verge reports.

Many of the insurance gaps and regulatory issues present in adapting to the sharing economy will also be true in the era of driverless—as the industry attempts to answer coverage and liability questions around the technology itself.

That means data mining in this early phase will be important. Thanks to hundreds of on-vehicle sensors, the average autonomous car will churn out 4,000 gigabytes of data per day, Intel CEO Brian Krzanich said at the December 2016 AutoMobility conference in Los Angeles. In the past year, the chipmaker has acquired telematics provider Mobileye for $15.6 billion and begun testing 40 self-driving cars with BMW, equipped with both of the companies’ technologies. Intel was also an early partner with Tesla for its autonomous tech.

Insurers are preparing to ingest the large amounts of data autonomous vehicles will spit out. Many have entered connected-car partnerships with automakers and telematics startups to gather more customer data in addition to the use of dongles and usage-based insurance programs. Granular data available consists of acceleration, braking, total mileage per trip and how often drivers talk or text using a vehicle’s operating system. Even data on a car’s overall performance is up for grabs for insurers.

“Autonomous vehicles are the end game. Being able to understand trends throughout the transition will allow Farmers to better prepare and adapt along the journey,” said Mariel Devesa, head of innovation at Farmers Insurance. “Connected-car data and driverless-car data are things we look at. We launched Signal [Farmers’ UBI offering] last year to get smarter insights on the driver itself.”

In a full autonomous stage, there will likely be a shift from personal to commercial risk, Devesa says. As vehicles become smarter, the frequency of accidents should also decline. The one caveat is when accidents involving autonomous cars do occur; repair costs will skyrocket due to the expensiveness of the technology installed.

On the insurtech startup front, SURE, an MGA distributing cellphone, travel and renter’s insurance coverage for clients such as Nationwide, Marsh and Chubb, has also developed a sharing economy product with an eye towards driverless vehicles. The startup’s offering, which is distributed through a mobile app, protects only the passenger, allowing policyholders to buy accidental death, injury, and dismemberment coverage before a trip.