Toronto, Ontario -- The widespread adoption of autonomous vehicles could halve auto insurance costs by 2040, Goldman Sachs has found.
In a research note issued by the bank, analyst Mark Delaney suggests AV technology would reduce the frequency of claims and cut the cost of insurance from about US$0.50 to US$0.25 per mile, or about $0.31 to about $0.14 per kilometre by 2040.
“We expect accident frequency to decline materially with the rollout of autonomous vehicles,” Delaney said in the report.
The report was not published publicly but has been cited in multiple industry and financial media outlet. It also concluded AV technology could prompt a re-evaluation of how liability is assigned in traffic incidents. As vehicle software increasingly takes control of driving decisions, responsibility is expected to shift away from individual drivers and toward manufacturers and technology providers.
“Ultimately, we expect the liability for accidents will move from the driver to the manufacturer, supplier and software provider over time,” Goldman’s analysts wrote.
While the global investment bank believes premium prices will eventually fall, it also noted that they were likely to rise in the shorter term due to the increasing costs of vehicle repairs.
As Collision Repair recently reported, even minor collisions involving ADAS-equipped vehicles can result in substantial repair bills, owing to the sensors, cameras and computing modules embedded throughout the vehicle body.
