Technology in the vehicle industry changes fast. It also affects your driving despite the type of car you drive. So, car manufacturers have to stay on top of their game by using new tech in each new model.
These advancements in auto tech have helped lower the risk of accidents. But so far, unfortunately, new tech has never lowered car insurance rates. Instead, car insurance quotes have shot up with modern cars.
Take a look at how tech affects car insurance rates.
The Cost of Repairs
Advanced technological features in vehicles have improved vehicle function. In the past, these features were simpler. But today, many manufacturers fit their cars with improved features and components for safety and entertainment.
For example, cars with navigation features use more electronic parts. But in case of repairs, you will need more time. With the increased time for repairs, the costs of labor increase.
In addition, the parts used for repair are costly. Thus, the increase in the cost of repairs also increases the costs for insurers.
This is why insurance rates have been increasing in modern cars over the years. Insurers increase the rates to offset repairs or replacement costs in case of accidents or theft.
Improved Car Safety Features
Modern car safety features include blind-spot monitoring, rearview cameras, airbags, and lane-departure protection. These new developments are crucial for the safety of drivers on the road.
Ideally, modern features should reduce the risk of accidents and fatalities. As well, the lower risk of car accidents should lead to lower insurance premiums.
But the operation of vehicles is still subject to human error. The safety measures in place do not guarantee accident prevention. After all, drivers are humans; once distracted, they may end up in accidents. Ironically, more safety features in vehicles, such as more warnings, have caused more distractions.
Many drivers expect lower insurance rates with these safety features in their cars; instead, they see the opposite.
So, when buying a new car, it is important to consider how expensive it would be to repair the safety equipment.
For example, it may be quite costly to replace modern airbags. It is even more expensive if it is the passenger-side airbag. That’s why some companies offer to replace your car instead of going through with the repairs.
Some cars even share the same model and year but with different insurance rates. This depends on the different trim levels in the car. Each trim level can have different features, which may vary the cost of insuring each car.
Automated Cars and Insurance Rates
Automated cars are a huge advancement in vehicle technology, and they may hit the market soon. These self-driving cars are famed for operating and moving independently with no one behind the wheel.
Ideally, they should eliminate human error and be more efficient and convenient.
But few questions arise when it comes to self-driving cars. First, who will be liable in case of an accident? Here, the responsibility of safe driving shifts from the driver to the manufacturer. So, if you get into an accident, you may not be responsible as you were not operating the car.
Transferring this responsibility from the driver to the manufacturer will impact the policies. For example, insurance companies will have to provide different policies. And these policies will include one for the driver and another for the vehicle.
Another factor is the advanced safety and security features. These include lane-assistance and self-parallel parking.
With autonomous vehicles, the risk of car accidents should decrease. As a result, your premium rates should go down due to decreased insurance claims.
But these improved features are not likely to have a huge impact on the insurance rates. As mentioned, they cost more to repair and replace. For example, a park assist camera costs somewhere between $589-$605 to replace.
Other parts like the electric hybrid battery will even cost more. So, the cost of insuring autonomous cars is likely to be higher.
Smartphones When driving
Smartphones have become a part of everyday life. Unfortunately, they have caused a decline in safe driving habits, affecting our safety on the road. Distractions are a major cause of accidents and deaths on our roads. And smartphones use while driving leads to such distractions.
Studies have shown that drivers using their phones behind the wheel are likely to have accidents.
This risk factor is likely to increase your insurance rates. Most insurers have developed apps to make personalized insurance policies. The insurance companies make these policies according to your driving habits.
If you are buying a new car, it is important to consider the technological advancements in your vehicle. Also, review the cost of repairing the technological features in your car. This will help you determine your modern car’s effect on insurance rates.
But if the insurers’ trend is anything to go by, auto insurance won’t go down unless research shows that new tech lowers the possibility of an accident.