We have been examining the factors that could prompt regulators to require carmakers to give future drivers the ability to disengage their self-driving vehicles’ auto-pilot function and take control of their cars. That development would mean drivers would still have to purchase liability insurance, softening the hit to auto insurers’ future revenues when the accident-avoidance technology on self-driving cars leads to far fewer accidents and carmakers assume liability for the crashes that do occur if their self-driving vehicles’ technology fails.
But even if auto insurers do not suffer as big a hit to their revenues as some experts predict, carriers still need to begin planning for some reduction. No single approach likely will be sufficient, and there is no time like the present to begin implementing these measures:
- Invest in digital technology—and in the workforce of the future. As Accenture reports, insurance executives are embracing digital technology as a core element of their growth strategy. Insurers expect premium income will grow by 5 percent on average as a result of their digital initiatives. But insurers will have to compete for the talent they will need to implement those strategies. They cannot begin soon enough.
- Invest in robotic process automation (RPA). As this Accenture report explains, properly implemented RPA enable the scalable, flexible and responsive workforce that is essential in a digital marketplace. Freed from routine process activities in various functions—including applications handling, claims processing and data entry—back-office staff can be redeployed to front-office roles where they can focus on complex customer demands and generate growth. RPA can free up between 20 and 30 percent of capacity at an enterprise level and minimize operational risk while also and improving the customer experience, which is critical for growth.
- Don’t delay in developing ecosystem strategies. The boundaries of various industries already have blurred, shifting market power to newcomers. The insurance industry will be no different, as Accenture explains in this report. Enterprises can gain visibility into the disruptive forces of ecosystems by developing strategies to forge new roles and new paths.
Also in this series:
- Self-driving cars might not hit auto insurers’ revenues
- Quite as hard as estimated
- Consumers’ concerns over self-driving car technology
- Could soften future hit to auto insurers’ revenues