Have you been living and loving the Status Quo? Come on, Bankstone News is willing to bet you have! If so, you might want to read about some deeply unsettling comments made by AXA technical bloke Davey Williams.
We’re talking, of course, about the good old UK motor insurance market. It’s been fun, hasn’t it? Constantly competing for a share of a mass consumer market that’s sure to make a profit one of these days. Except it isn’t!
According to reports in top industry title Insurance Tights, “a new, robot-powered storm is forming on the horizon.” And if AXA Dave’s right, “the Status Quo we’ve lived and loved is all going to collapse around us.
Can this be right? Or was DW just having a bad day? Well, it kind of could be. For one thing, there’s those robots. Top consulting firms like Deeeeee-Loite, Excenture and even the Bank of England reckon robocars will soon be taking over, and taking with them all the conventional motor premium we’ve been coveting all this time.
AXA reckon the combination of Artificial Insemination (AI) and driverless vehicles could “wipe” a huge chunk of the UK motor insurance market out within a couple of decades. The Bank of England reckons 40% of current premiums could be gone by 2040.
Deeeeee-Loite broadly agree, citing the pernicious influence of factors including: technology doing away with many of the claims that provide the rationale for insurance purchase, fewer people wanting to own and drive their own exclusive vehicles in the way folks have traditionally done, and everything being done by robots as previously noted.
Whatever’s left of the motor insurance market will look very different to how it looks today and will involve: people sharing cars, people in driverless cars, people sharing driverless cars, and cars sharing driverless people. Possibly.
Luckily for AXA, Dave explains, le beemote français, is an aggressive incumbent with an enormous footprint and some specially adapted innovation and incubation arms. AXA has hired some chatbots to handle policy enquiries and created a special machine called Rrrrradar which advises its management liability clients on legal stuff, allowing it to reduce its exposure to puny illogical humans.
One of the big threats to traditional motor insurers is something called “embedded insurance”. This does not literally mean that insurance is in some kind of bed or anything. It means that you buy your car and its insurance as a package. But here again le colosse qui mange de l’ail may have an advantage, seeing as it’s the underwriter behind InsureMyTesla.
So, basically, AXA will probably be fine (reassuring news for its shareholders there!) but the rest of you are probably done for.
So, yes, it has been fun, but like the wise man says, all good things (and bad things for that matter) are of, shall we say, finite durability!
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