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AI, EVs and auto tech pose a threat to traditional auto insurance

In addition to tech, carmakers’ vertical integration of the entire ownership experience could shake up the auto insurance space.

By Corey Brundage | August 06, 2021 at 04:00 AM
If insurers are to respond to this threat and avoid getting squeezed out of their market by automakers’ new technologies and business models, they need to begin taking advantage of the same technologies that companies like Tesla are using, such as artificial intelligence (AI) and advanced data analytics, to improve efficiency and provide a superior customer experience. (Credit: Stanisic Vladimir/Shutterstock.com) If insurers are to respond to this threat and avoid getting squeezed out of their market by automakers’ new technologies and business models, they need to begin taking advantage of the same technologies that companies like Tesla are using, such as artificial intelligence (AI) and advanced data analytics, to improve efficiency and provide a superior customer experience. (Credit: Stanisic Vladimir/Shutterstock.com)

Some of today’s biggest innovations in automotive technology are also some of today’s biggest risks for traditional auto insurers. Smarter cars are safer cars, but they are also significantly more expensive to service, meaning higher premiums for consumers.

Electric Vehicles require a new skill set to service them, skills which are in short supply increasing risks and costs to insurers’ most frequent claims.

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