Driver safety tech fuelling insurance timebomb

Advanced semi-autonomous driving aids are behind an unprecedented number of cars being written-off by insurers after even a small collision, leading to premiums soaring globally.

According to new research published recently by US-based Bloomberg, more than one in five cars are now found to be beyond economical repair after an accident, which is five times higher than in 1980.

Worse still, insurance experts suggest that the 20 per cent write-off rate is expected to rocket to more than 30 per cent.

And the reason? The embedded tech that provides functions like autonomous emergency braking (AEB), adaptive cruise control and a whole host of other semi-autonomous driver aids are getting more complex and expensive.

It was hoped that by rolling out the new advanced tech it would reduce the number of crashes.

However, in some markets, such as the UK, that can’t happen soon enough as premiums rose on average by 21 per cent in 2023 alone.

Interestingly, the latest figures, which were gathered by CCC Intelligent Solutions, suggests that electric cars are written-off less frequently on average than combustion-engined cars – although poor resale values surrounding EVs might lower the threshold for economical repair.

What hasn’t been highlighted is how much on average insurance premiums have risen in response to ADAS tech, or how the car industry will respond to addressing the spiralling cost of the advanced tech.

If there are any winners in this saga it’s the car salvage auction industry, with companies like Copart seeing its shares rocket by 1110 per cent over the past decade.

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