> if autonomous vehicles become common and are a lot safer than manual driven vehicles, insurance rates for human driven cars could wind up exploding as the risk pool becomes much smaller and statistically riskier.

The assumption there is that the remaining human drivers would be the higher risk ones, but why would that be the case?

One of the primary movers of high risk driving is that someone goes to the bar, has too many drinks, then needs both themselves and their car to get home. Autonomous vehicles can obviously improve this by getting them home in their car without them driving it, but if they do, the risk profile of the remaining human drivers improves. At worst they're less likely to be hit by a drunk driver, at best the drunk drivers are the early adopters of autonomous vehicles and opt themselves out of the human drivers pool.

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seanmcdirmid 11 hours ago | parent [-]

Drunk driving isn't the primary mover of high risk driving. Rather you have:

1. People who can't afford self driving cars (now the insurance industry has a good proxy for income that they couldn't tap into before)

2. Enthusiasts who like driving their cars (cruisers, racers, Helcat revving, people who like doing donuts, etc...)

3. Older people who don't trust technology.

None of those are good risk pools to be in. Also, if self driving cars go mainstream, they are bound to include the safest drivers overnight, so whatever accidents/crashes happen afterwards are covered by a much smaller and "active" risk pool. Oh, and those self driving cars are expensive:

* If you hit one and are at fault, you might pay out 1-200k, most states only require 25k-50k of coverage...so you need more coverage or expect to pay more for incident.

* Self driving cars have a lot of sensors/recorders. While this could work to your advantage (proving that you aren't at fault), it often isn't (they have evidence that you were at fault). Whereas before fault might have been much more hazy (both at fault, or both no fault).

The biggest factor comes if self driving cars really are much safer than human drivers. They will basically disappear from the insurance market, or somehow be covered by product liability instead of insurance...and the remaining drivers will be in a pool of the remaining accidents that they will have to cover on their own.

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AnthonyMouse 10 hours ago | parent [-]

> Drunk driving isn't the primary mover of high risk driving.

It kind of is. They're responsible for something like 30% of traffic fatalities despite being a far smaller percentage of drivers.

> People who can't afford self driving cars (now the insurance industry has a good proxy for income that they couldn't tap into before)

https://pubmed.ncbi.nlm.nih.gov/30172108/

But also, wouldn't they already have this by using the vehicle model and year?

> Enthusiasts who like driving their cars (cruisers, racers, Helcat revving, people who like doing donuts, etc...)

Again something that seems like it would already be accounted for by vehicle model.

> Older people who don't trust technology.

How sure are we that the people who don't trust technology are older? And again, the insurance company already knows your age.

> Also, if self driving cars go mainstream, they are bound to include the safest drivers overnight

Are they? They're more likely to include the people who spend the most time in cars, which is another higher risk pool, because it allows those people to spend the time on a phone/laptop instead of driving the car, which is worth more to people the more time they spend doing it and so justifies the cost of a newer vehicle more easily.

> Oh, and those self driving cars are expensive

Isn't that more of a problem for the self-driving pool? Also, isn't most of the cost that the sensors aren't as common and they'd end up costing less as a result of volume production anyway?

> Self driving cars have a lot of sensors/recorders. While this could work to your advantage (proving that you aren't at fault), it often isn't (they have evidence that you were at fault). Whereas before fault might have been much more hazy (both at fault, or both no fault).

Which is only a problem for the worse drivers who are actually at fault, which makes them more likely to move into the self-driving car pool.

> The biggest factor comes if self driving cars really are much safer than human drivers.

The biggest factor is which drivers switch to self-driving cars. If half of human drivers switched to self-driving cars but they were chosen completely at random then the insurance rates for the remaining drivers would be essentially unaffected. How safe they are is only relevant insofar as it affects your chances of getting into a collision with another vehicle, and if they're safer then it would make that chance go down to have more of them on the road.

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seanmcdirmid 9 hours ago | parent [-]

Only .61% of car crashes involve fatalities, so that’s like .2% of car crashes you are referring to. Probably more due to alcohol, but we don’t know the ratio of accidents that involve alcohol, which would be more telling.

> How sure are we that the people who don't trust technology are older? And again, the insurance company already knows your age

Boomers are already the primary anti-EV demographic, with the complaint that real cars have engines. It doesn’t matter if they know your age of state laws keep them from acting on it.

> that more of a problem for the self-driving pool? Also, isn't most of the cost that the sensors aren't as common and they'd end up costing less as a result of volume production anyway?

I think you misunderstood me: If you get into an accident and are found at fault, you are responsible for damage to the other car. Now, if it’s a clunker Toyota, that will be a few thousand dollars, if it’s a roll Royce, it’s a few hundred thousand dollars. The reason insurances are increasing lately is that the average car on the road is more expensive than it was ten years ago, so insurance companies are paying out more. If most cars are $250k Waymo cars, and you hit one…and you are at fault, ouch. And we will know if it is your fault or not since the Waymo is constantly recording.

> If half of human drivers switched to self-driving cars but they were chosen completely at random then the insurance rates for the remaining drivers would be essentially unaffected.

That’s not how the math works out (smaller risk pools are more expensive per person period). And it won’t be people switching at random to self driving cars (the ones not switching will be the ones that are more likely to have accidents).

	▲	AnthonyMouse 4 hours ago \| parent [-]
		> Only .61% of car crashes involve fatalities, so that’s like .2% of car crashes you are referring to. Probably more due to alcohol, but we don’t know the ratio of accidents that involve alcohol, which would be more telling. Fatalities get more thoroughly investigated so we have better numbers on them, but if you had to guess whether the people who get behind the wheel drunk were similarly disproportionately likely to bang up their cars in a non-fatal way, what would your guess be? > Boomers are already the primary anti-EV demographic, with the complaint that real cars have engines. EVs and self-driving are two different things. Fox News tells boomers that EVs are bad because Republicans have the oil companies as a constituency. > It doesn’t matter if they know your age of state laws keep them from acting on it. The only states that do that are Hawaii and Massachusetts.[1] [1] https://www.cnbc.com/select/best-car-insurance-seniors/ > If most cars are $250k Waymo cars, and you hit one…and you are at fault, ouch. And we will know if it is your fault or not since the Waymo is constantly recording. If X% of cars are Waymos and you hit another car in your normally priced car and you're at fault, there is an X% chance it will be expensive. If the Waymo hits another car and it's at fault, there is a 100% chance it will be expensive because it will damage itself, and an additional X% chance that it will be very expensive because both cars are. And again, that's assuming the price stays as high as it is when the production volume increases. A $250,000 car can't become the majority of cars because that percentage of people can't afford that. > That’s not how the math works out (smaller risk pools are more expensive per person period). Smaller risk pools don't have higher risk, they have higher volatility, and then if they're too small insurers have to charge a volatility premium. But the auto insurance market is very large and for it to get to the size that it would have volatility issues it would have to be a consequence rather than a cause of the large majority of people switching to self-driving cars. > And it won’t be people switching at random to self driving cars (the ones not switching will be the ones that are more likely to have accidents). You keep saying that but it's still not obvious that it's what would happen, and in any event the ones more likely to have accidents are already the ones paying higher insurance premiums -- which is precisely a reason they would have the incentive to be the first to switch to self-driving cars.