Berkshire Hathaway owns Geico the car insurance company. In one of his annual letters Buffett said that autonomous cars are going to be great for humanity and bad for insurance companies.
“If [self-driving cars] prove successful and reduce accidents dramatically, it will be very good for society and very bad for auto insurers.”
Actuaries are by definition bad at assessing new risk. But as data get collected they quickly adjust to it. There are a lot of cars so if driverless cars become even a few percent of cars on the road they will quickly be able to build good actuarial tables.
Berkshire Hathaway owns Geico the car insurance company. In one of his annual letters Buffett said that autonomous cars are going to be great for humanity and bad for insurance companies.
“If [self-driving cars] prove successful and reduce accidents dramatically, it will be very good for society and very bad for auto insurers.”
Actuaries are by definition bad at assessing new risk. But as data get collected they quickly adjust to it. There are a lot of cars so if driverless cars become even a few percent of cars on the road they will quickly be able to build good actuarial tables.