The motor industry’s technology is advancing rapidly. With the introduction of electric and autonomous vehicles, the motor space will change entirely. Although this advancement is great for customers, what does it mean for their on-road protection?
Every car owner and car insurance policy provider faces the same question. We will explain it here, but before that, let’s understand electric and autonomous vehicle insurance.
What is Electronic Car Insurance?
An electric car insurance policy is a legal contract signed between the electric car owner and the insurance company. Similar to regular car insurance, electric insurance protects policyholders from financial loss due to unexpected incidents that cause car damage.
Electric car owners must have third-party car insurance. Still, it is more beneficial if you buy a comprehensive motor insurance policy as it provides you with coverage of third-party liability and other additional coverage benefits.
What is Autonomous Vehicle Insurance?
Autonomous vehicle insurance is a policy that provides coverage for financial or legal liabilities due to mechanical or human error. Although autonomous vehicles are still unavailable in India, we can only hypothetically answer about this insurance.
It is known that autonomous vehicles involve a certain degree of human intervention, which makes them prone to human errors that can cause damage. Even in completely autonomous vehicles, accidents due to mechanical or software errors are possible. Thus, autonomous vehicle owners must have car insurance.
Affect Electric and Autonomous Vehicles on Car Insurance Policies
Impact of Electric Vehicles on Car Insurance Policy
With more and more people switching to electric cars, insurance companies have also started modifying their plans as per requirements.
- One of the upcoming insurance trends is pay-as-you-go car insurance. Under this type of insurance, the premium is decided based on the distance the policyholder drives rather than applying an annual premium price. This is great for electric car owners, as they drive significantly fewer kilometres than diesel/petroleum-driven cars.
- Another trend in electronic car insurance is the use of telematics. Telematics technology tracks drivers’ driving habits, such as braking and acceleration. Insurers use this information to calculate premiums for electric insurance policies.
Impact of Autonomous Vehicles on Car Insurance Policy
As mentioned earlier, autonomous cars are still not available in India. However, based on the information available, insurance providers might have to make these changes.
- Autonomous cars use software and hardware that are prone to cybersecurity risks. These include malware attacks, ransomware, hacking and misuse of sensitive vehicle information. Insurance companies might offer coverage against cybersecurity risks.
- These vehicles rely heavily on car-related chips and sensors for security purposes. However, these chips and sensors are prone to bugs and hardware breakdowns that could lead to loss. Thus, autonomous car insurance companies might cover liabilities related to this issue.
Summing Up
The evolution of cars to electric and autonomous mechanisms is changing the way people drive. However, this does negate the importance of having a car insurance policy. Yes, the way insurance coverage is provided might need to evolve with time.
Thus, always look out for insurers like TATA AIG Motor Insurance that are making changes in the motor insurance field to provide the best protection.