Good morning. I’m Saul Reisman here at Saul’s Automotive, and today we’re gonna talk a little bit about some of the new technology we’re seeing in cars and how some of these effects might play out on the market in ways we didn’t anticipate.

We always talk about ways that these systems can make the cars safer, drivers safer, more attentive, and keep us in a better quality and condition to pay attention on the road. However, there’s other pieces and parts that a lot of us don’t look at. For instance, recently, in an SEC stock exchange filing for the quarter, Liberty Mutual Insurance said something really interesting.

A company that’s been selling insurance for almost 100 years said, “We are concerned that, in the next 10 years, we will not be able to justify and implement a higher insurance premium like we currently charge, because autonomous vehicles will change the safety standard so much that our premiums are going to have to drop substantially accordingly, and we may have a problem. We-we may have a-a business model problem that needs to change.” Stockholders freaked out. They’re trying to find a solution. They’re looking at different options.

The insurance companies, of course, are looking at ways that they can lobby to make things change, cuz they always want to see it from a different legal perspective, but what’s interesting for us to see here is that, you know, in the 1950s, 1960s, the American public demanded muscle cars, so Detroit delivered muscle cars, and your insurance premium reflects that now down the road, where you have cars that are going faster and faster, and if you buy the faster model of the same car it’s gonna come with that insurance premium to dictate. Now, as cars become safer and safer, insurance companies are worried.

The auto insurance companies are scared they’re going to go out of business.

They are concerned that they won’t be able to make you pay the premium for your sports car, racecar, etc., because of how many cars will be so safe and so basic in terms of such. They’re also looking at urbanization, the fact that 70 percent of their customers are now moving into urban areas, where they’re more and more likely to utilize mass transit, which will become bigger and bigger as autonomous vehicles hit the market, and they’re more likely to have an autonomous vehicle with more safety systems that would keep them in check and keep their premium down as well. So, of all the things that we expected to see change in the market, we never expected to see insurance companies starting to tread water and wonder what’s coming next.

What that may mean for us is a very fantastic perspective. It means insurance companies are going to actually have to look at what keeps you safe and justify your rate accordingly to that as opposed to using past history.

They’ll only be able to use different parts and different pieces of vehicles in addition to information about you as the vehicle owner when they’re trying to determine how to best take care of you and insure you properly. For most of us, this is gonna mean a pretty substantial drop in our premiums. It’ll also mean that we’re gonna be in safer cars that will hopefully last us a lot longer and keep us out of a lot more trouble.

If you’ve got any questions or concerns about what might be changing or what different systems might affect your insurance premium when you go to buy a new car, please come and talk with us before you do. We’d be happy to coach you in the right direction so that you get the proper systems on your car that do the job you need, you don’t spend a ton of money breaking the bank, but you still protect yourself, protect your investment and protect your family.

Give us a call here at Saul’s Automotive at 303-919-7769. Thank you.

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