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The Oracle of Omaha this month was indicated that neural networks constituted a threat to Berkshire Hathaway's auto insurance business. Wording at the company's annual converge, Berkshire CEO Warren Buffett said the use of AI in self-driving cars will make fewer moves and fewer customers for the company's Geico insurance commodities .
Turns out Buffett may have spoken too soon. Harmonizing to a new report from Accenture, the overall auto assurance will actually grow in the future, creating $81 billion in new revenue between 2020 and 2025.
The report, published on Thursday, explains that self-driving cars will lead to a big drop in individual insurance premiums. But that plunge will be more than compensated for by new categories of vehicle guarantee, especially ones related to cybersecurity, which Accenture answers will be worth $12 billion in 2025.
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The report likewise points to new opportunities in produce liability assurance related to autonomous vehicles( foreseen significance of $2.5 billion) and a smaller opening ($ 0.5 billion) in the form of insuring infrastructure like shadow computing that will be needed to run sails of driverless cars .
Here is a planned that shows how Accenture believes the brand-new makes will, for a period, buoy the vehicle guarantee sell even as marketings conventional payments begin to stop and nosedive :
According to John Cusano, the global head of insurance for Accenture, many auto assurance claims in the future will be different than ones we see today. For speciman, insurers will have to pay out for incidents such as inaccurate AI concoctions or a intruder embezzling personal data from a vehicle. Cusano adds that the new opportunities are significant but not every insurance company is equally positioned to take advantage of them .
" Obviously, the ones who will be most requested is likely to be those on the retail slope of the business since the new threats are on the commercial side. Retail insurers will have to transform their business along the way ," he tells Fortune .
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This indicates the likes of Geico will indeed face pressure but that they still have time to adapt and grab a share of the commercial sell. And in the short term, Cusano responds the growth of autonomous vehicle engineering will actually bolster retail insurers. That's because cars now come with most expensive AI-related technology, like cameras and sensors, which build the cost of repairing a fender bender much higher than it used to be.A final wild card in auto insurance marketplaces of the future is the potential entry into the business of manufacturers. Cusano alleges Tesla's small attacks into the insurance marketplaces could expand. Meanwhile, Google is exercising its sail of self-driving a motor vehicle is amass immense troves of risk-related data, which could made the search giant in a position to join other new entrants as a fierce adversary in the insurance grocery .Thank you for read this news
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