by Rich Flynn, ACORD
If you grew up with Knight Rider and you're tired of waiting for your chance to own a car that cool, you've probably been following all the recent developments about driverless cars with mounting excitement. You no doubt remember when we told you that Navigant Research predicts that 95.4 million driverless cars will be on the road in 2035 - accounting for 75% of all light duty vehicle sales - and when futurist Michio Kaku told us to expect the technology to be readily available even sooner.
"The Pentagon has pushed this technology for the military, and it will eventually be in your garage - in about eight years' time," Kaku said.
However, it turns out that you may have the chance to take a ride in a driverless car as early as this year - if you happen to find yourself in Singapore, that is. MIT's Technology Review recently reported that, at a panel held at the university, a government official revealed that the island city-state will be experimenting with a driverless cars on the roads in 2015.
Lam Wee Shann, director of the Ministry of Transport's futures division, said that one of Singapore's neighborhoods will be opened to driverless cars this year, picking up passengers for brief trips to and from train stations and other public transit hubs. "Singapore welcomes industry and academia to deploy automated vehicles for testing under real traffic conditions on public roads," he said.
The trial is part of a larger strategy to "provide first-and-last-mile connectivity to main public transport nodes," Shann explained, in order to remake Singapore into "a city built around walking, bicycling and public transit." The tiny country (only Macau and Monaco are more densely populated) has already taken measures to alleviate automotive traffic, including imposing a fee on car purchases that can double the price of the vehicle, and offering free travel and breakfast vouchers for travelers who take city trains before peak periods.
The innovative city-state will also be the site of the upcoming ACORD Forum Asia, to be held March 10-11 at the Fullerton Hotel.
So, what effects will the mass adoption of driverless cars have on insurance? "This is going to affect the insurance industry because of course, traffic accidents, traffic jams - they are so disruptive to society - they will probably disappear," Kaku told us. Indeed, at the same MIT event where Shann unveiled his country’s experiment, senior MIT researcher Paolo Santi explained that simulations at his lab have shown twice as many driverless cars can route themselves safely through intersections than traditional cars, thereby cutting down on the usual side effects of stop-and-go traffic: congestion, heavy greenhouse gas emissions, and - presumably - collisions.
If accidents are a thing of the past, can auto insurers survive? According to Celent's Research Director, Chuck Johnston, they certainly can - if they're flexible in adapting to a new model of insurance. "If you're an auto insurer, maybe you're not so much underwriting your traditional driving experience, but there's more concern about how well you maintain your car, are you using it in an appropriate manner," he said. "Because your risk may not be so much the traditional collision, it may be a liability umbrella issue."