Texas Living

The Future Is Here: How Self-Driving Cars Are Changing Our Roads

By Peter Simek 5.12.23

Although the skies are not filled with the flying cars many sci-fi depictions of the 2020s once promised, innovations in transportation are nonetheless poised to reinvent how we get around.

The automotive industry continues to adopt emerging technologies, and electric and self-driving cars are rapidly expanding their share of the market. In an effort to address environmental and air quality challenges, some governments and states are even setting mandates to phase out gasoline-powered cars by target dates.

Self-driving cars, all of which are currently either electric or hybrid, represent more than a significant shift away from traditional gasoline-powered cars; they also have the potential to reinvent the way we think about safety, traffic, and insurance.

Safety First

Let’s start with safety. According to the National Highway Traffic Safety Administration, human error is the leading cause of traffic accidents in the U.S. Although some safety and transportation advocates argue that this statistic oversimplifies what makes our roads dangerous, there is agreement that self-driving cars have a role to play in making our roads safer. By eliminating the need for a human driver, these vehicles have the potential to greatly reduce the number of accidents caused by human error. In fact, some studies have estimated that self-driving cars could reduce traffic fatalities by up to 90%.

Of course, self-driving cars are not without their own risks. Cybersecurity is one of the biggest concerns associated with these vehicles, as hackers could potentially take control of a self-driving car. Additionally, as we have already seen in some frightening crashes, there is the risk that self-driving cars could malfunction, leading to accidents or other issues. With the right safety protocols and regulations in place, these risks can be mitigated. It is clear that as our cars become smarter and more aware of our behavior on the road, they will change how we address auto safety.

Reducing Congestion and Pollution

In addition to safety, self-driving car advocates argue that autonomous vehicles have the potential to greatly reduce traffic congestion. Self-driving cars can optimize traffic flow and reduce the number of accidents and lane closures, which can contribute to smoother and more efficient traffic patterns.

Scientists are also working to incorporate AI and communications technology into other transportation infrastructures, such as stoplights. When smart vehicles can communicate with smart traffic lights, the network can be quickly adopted and optimized for faster traffic flow.

Of course, environmental concerns are one of the major motivations driving the fast adaptation of electric vehicles in general. Greenhouse gas emissions from the transportation sector account for about 27% of all U.S. emissions. With the vast majority of the scientific community in agreement that carbon emissions are disrupting the normal functioning of our atmosphere, electric vehicles are seen as a key component of a broad carbon reduction strategy.

There are other environmental benefits to electric vehicles. Electric cars produce less noise pollution and emit fewer pollutants, which can contribute to fewer traffic-related health problems and less impact on air quality. Electric cars also tend to have fewer moving parts and are less prone to catching fire or exploding.

The Impact on Insurance

A major study by the RAND Corporation in 2020 predicts that the U.S. auto insurance industry is flexible enough to accommodate any new or unknown variables that the wider adaptation of autonomous vehicles will introduce.

In the long run, the study found, there may need to be some adjustments to the way insurance companies approach the autonomous vehicle fleet and urged insurers and manufacturers to begin collecting AV data to prepare. But the widespread adoption of self-driving cars is unlikely to change the fundamental way the claims process works.

AVs, however, may lead to new forms of coverage. While accidents may become rarer, some experts argue that insurance companies will need to shift their focus to cybersecurity and other risks associated with self-driving cars.

Additionally, the cost of repairing self-driving vehicles is likely to be higher due to their complex technology, which could lead to higher insurance premiums for these vehicles. In fact, we are already seeing that the higher cost of autonomous vehicles could lead to higher rates, as the cost to replace the vehicle is more significant.

Toward a Sci-Fi Future

Challenges associated with the widespread adoption of electric and self-driving cars include vehicle cost, expanding charging infrastructure, increased demand on electrical grids, and limited natural resources for battery manufacturing. So, what does the future of the automotive industry look like in light of these developments? It’s difficult to say for sure, but it’s clear that electric and self-driving cars are here to stay.

The benefits of these technologies are clear: They could lead to improved safety and traffic conditions and reduced environmental impact. What is less clear is just how the widespread adoption of electric and self-driving cars will change transportation and pose new challenges for the insurance industry.

As these technologies continue to evolve, it will be important for policymakers, businesses, and individuals—as well as the insurance industry—to adapt to these changes and ensure that their impacts are directed toward creating a safer and cleaner future.

Are you considering purchasing an electric car? Be sure to familiarize yourself with what you should know about electric car insurance.

© 2023 Texas Farm Bureau Insurance