A study published by Deloitte maintains that car insurance rates could drop up to 30 percent in the next 25 years as self-driving vehicles and ride-sharing services become commonplace.

The report identifies three main factors that could contribute to the decline in premiums, including:

    1. A reduction in the number of cars being driven as ride-sharing services increase in popularity.
    2. A decrease in the number of claims as self-driving technologies are implemented in vehicles.
    3. A shift in coverage from personal to commercial and product liability insurance.

Deloitte principal John Matley indicates that the same technological shifts that are posing challenges to automakers may also threaten the business models of the insurance companies. However, he also maintains that insurers can thrive if they anticipate change and adapt. For Matley, new opportunities will be presented through the increased demands of commercial coverage and by building relationships with technology providers and automakers.

The study also concludes that time frame for transitioning from the traditional driver-centric model to one in which shared autonomous vehicles is prevalent will be dependent on regulatory approval, the evolution in technology and the degree of acceptance among drivers. To remain profitable in the long-term Matley suggests that insurers will need to make adjustments within the next five to 10 years.