Autonomy is on the way
Barry Sheehan, PhD researcher, Limerick University told IBIS Ireland 2018 delegates that autonomous driving vehicles are coming – like it or not.
Returning to speak at the event for the second consecutive year, Barry opened his presentation by suggesting in the past 12 months, ‘a lot has happened and nothing has happened’. He pointed at how there has been much attention given to the development of autonomous vehicles but little focus on the actual risks they pose – the greatest risk to the development of autonomous vehicles, according to Barry, being malicious hackers.
‘Autonomy is going to change the world,’ said Barry, ‘some like it, some don’t but it’s going to happen and it’s not just cars.’ Barry then highlighted how autonomy is impacting a number of industries – warehousing construction, airports etc – and specifically within automotive how the development of technology is seeing an increasing influence of vehicle manufacturers within the aftercare sector.
Supporting the changes afoot within the insurance sector, Barry referenced statistics which suggest the auto insurance market could decline to 40% to 50% of its current size by 2030 but, as Barry suggested, ‘the timing and extent of the development remains uncertain’. Linked to this, Barry highlighted how the ADAS market is expected to grow from US$11bn in 2016 to US$132bn in 2026.
Whilst the end result might not be clear, the interim is even more unclear and Barry explained how a mixed vehicle fleet (ie autonomous and human drivers) will mean autonomous vehicles will need to drive like humans (not strictly to the rules) in order to be safe.
Barry highlighted one significant change from last year is that vehicles within the market now offer level three – conditional automation but, as he pointed out, use of these systems is not yet legal – ‘that’s how out of sync we are’ said Barry.
The increasing influx of technology, explained Barry will see risk models move from a high frequency, low severity model to a low frequency, high severity market. ‘The cost of the new technologies in the cars will be a lot more,’ said Barry.
With 250 million connected cars predicted by 2020 cyber risk will increase and Barry pointed to figures suggesting that cyber-risk is estimated to generate up to $12bn in new premiums in 2025. With this, Barry explained how Bayesian Networks are being implemented to assess cyber risk factors – allowing stress testing, scenario analysis and cost benefit analysis.
In closing the session, Barry suggested his key takeaways are the need for standards, vulnerability thresholds, collaboration – ‘closer collaboration between insurers and manufacturers’ – and proactive risk assessments.
IBIS Ireland is supported by lead partner AkzoNobel and partners Audatex, Fix Auto and Synergy.