How autonomous tech is shifting the insurance sector

At the beginning of the year, at the home of Lloyd's of London, Tom Allebone-Webb, Head of Strategy and Innovation at the insurance firm introduced a packed audience of industry professionals to Professor Paul Newman, Founder and Chief Technical Officer of autonomous vehicle software company Oxbotica.

The blurb about The Future of Autonomy event promised an opportunity to get up close with a zero occupancy all-electric self-driving vehicle that will revolutionise the goods and delivery market, but there was more to it than that.

Sam Tiltman, Sharing Economy and Mobility Leader at insurance broker and risk advisor Marsh described it as a call to action for a technological leap akin to the development of the internet.

“The combined impact of mobility-as-a-service, electric vehicles and automation will be huge,” he said. “If autonomous vehicles deliver on their promise, they will significantly reduce risk, so if we don’t invest in this, then we, as an industry, will be disrupted.”

Autonomous vehicles aren’t the stuff of science fiction, the car parked outside the grand main entrance was proof of that, piquing people’s attention.

The record-breaking The all-electric AppliedEV vehicle driven by Oxbotica, became the first autonomous vehicle to operate on UK public roads without a driver last year in Oxford. Passers-by were clearly struck by its skateboard-like appearance, with no doors, windows or seats, let alone a steering wheel. 

Newman’s presentation was direct: “Insurance and autonomy are intertwined, because both will be everywhere.

“Since the days of the horse and cart we have persisted with the idea of one operator per vehicle. Now it can be ‘n’ operators per vehicle, and it will be insurers who decide what ‘n’ is.

“Offline, the residual data from autonomy can be used to assess risk. Online, at a danger point, you can change behaviour. We call this insurance-in-the-loop,” he said.

Debate about the impact of autonomous technology and the insurance sector is continuous. Rebecca Marsden, Vice-President of Risk and Insurance at Oxbotica said: “This is not just about risk management. The depth of data is transformative. It requires us to be collaborative.”  

A pertinent question, quickly asked at The Future of Autonomy event; if you reduce risk sufficiently, do you need insurance at all?

Head of digital insurance specialist Apollo ibott 1971, Chris Moore had the answer: “Under our partnership with Oxbotica, we see them as a buyer of insurance today but a future distributor of insurance products or even a co-insurance partner.”

There are huge implications for the insurance sector as autonomous technology gains a greater foothold in automotive, from courts requiring a developer to reveal what’s inside the black box to the thorny issue of cyberattacks. But there is no shying away from the challenges ahead.

“The work is never finished, and insurers must be part of this digital solution – it will be ongoing, not something you can photocopy,” said Newman. “It will involve the sharing of best practice and keeping in mind why I got into this in the first place – safety.”

The insurance sector is just as impacted by new technologies as any other part of the automotive industry, and it needs to continually update its knowledge and approaches in order to succeed in a future that will be defined not just by electrification, but by autonomous vehicles too.