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Comment by siculars | Hacker News Reader

Ok, cool. So insurance companies should be lining up to insure autonomous cars, ya? As soon as an insurance company will insure an autonomous car then we will be able to buy them and use them. Or maybe the autonomous car makers will accept risk? This will be great! Cause the only person who wont have to have insurance is - me, the driver! Er... passenger.

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Insurance companies won't care if you're driving yourself or using a self-driving car.

They price their premiums so that they always make a profit, regardless of the risk.

That's why drivers that have accidents pay more than drivers with no accidents and young drivers (that are statistically more risky) pay more than not-young drivers.

Insurance companies will simply adjust the cost of insurance for self-driving cars to account for risk based on past data. If those cars will turn out to be involved in less accidents, the insurance will cost less. More accidents => cost more.

Even better, Google and the automaker's could get into the market of managing fleets and their own insurance directly or via wholly owned subsidiaries. That's what I would do if I were in their position. Basically, this is going to completely disrupt the auto insurance industry as well and no one has more and better data to price the insurance than Google that now has hundreds of thousands of miles logged and will always be in possession of the sum total of all data on all miles ever driven. They are no longer performing statistics on a sample size, but are instead doing so based on an entire population.

Basically Google can do the same for auto insurance that Amazon has done for online retail. i.e. they can operate on razor thin margins that no one else will ever be able to match because they'll be operating on sample-based statistics and it will take them a while before they have a significantly large sample to properly price their product.

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