Trickle Down from Auto Disruption (Short Insurance)

We’ve spent a good amount of time in the last year discussing the second order effects of autonomous cars. But, clearly Google is thinking ahead. This week Waymo LLC, the driverless-car unit of Alphabet Inc.partnered with an insurance-tech startup called Trovto nail down the mechanics of “micro-duration” insurance for riders. This would be “usage-based” insurances, covering riders for very discreet periods of time and very particular use cases. Risk could be assessed based on the duration of the ride (and, presumably, the trajectory?). This could be a game changer as far as insurance revenues go. Choice quote: “As much as 80% of the premiums paid to car insurers are at risk of disappearing in coming decades if autonomous vehicles make driving safer and prompt big changes in car ownership.” Yikes.

Electric Cars & Car Insurance

If all you do is look at headlines, this piece may give you the impression that electric cars are doomed. Tack on Tesla's underwhelming news and attendant stock decline (prior to Friday's slight recovery) and that view may be warranted. But let's back up a minute: does a $100-200 charge move the needle for purchasers of electric vehicles? Speaking of vehicles, how is the auto insurance industry looking as we enter the next phase of electric and autonomous car adoption? According to KPMGnot good.