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Will New Car Safety Technology Lower Insurance Premiums?

Written by Jared Staver

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Jared Staver is a Personal Injury Lawyer based in Chicago, Illinois and has been practicing law for over 20 years.

Jared Staver

CATEGORY: Auto Accidents, Personal Injury


As car manufacturing technology improves, more motor vehicles are being equipped with better safety features. While luxury and comfort are always going to be important to many car owners, preventing car accidents is a concern that affects not just the driver but the general public. But how are insurance companies responding to the inclusion of safety technology in the manufacturing of a car? And is that reflected in the premiums that owners have to pay?

Safety technology such as automatic emergency braking, lane departure warnings, and blind spot detection are some of the investments that car owners are willing to make to ensure the safety of their family and other road users. However, only two of the major auto insurers currently offer a discount in premiums for the installation of these safety devices.

What Are the Objections From Insurance Companies?

With only two major insurance providers offering discounts to owners for new car safety technology, there are concerns as to why and when the others will follow suit. Some insurance companies indicate that they are in the process of assessing the claims data before making a decision on offering a discount. Others are not so convinced that the technology will result in reduced accidents.

The Insurance Institute for Highway Safety (IIHS) conducted a study to determine the effect that automatic emergency braking had on preventing accidents. The results of the study were released earlier this year revealing that if all vehicles came equipped with automated braking, the country would see a 40% discount in rear-end crashes. This translate into 700,000 fewer crashes each year.

However, while it is clear that braking safety technology will surely help with the reduction in accidents on the road, other new safety technologies are not so convincing. Lane-departure warning has not performed with the same effectiveness, but there is some hope for blind-spot detection.

While the statistics may look good, another concern for insurance companies is the popularity of these technologies. The reality is that only 21 percent of vehicle manufactured this year in North America will come equipped with this braking safety technology. Additionally, with such low numbers, there are genuine concerns about the increased repair costs when vehicles with safety technology are involved in an accident.

What Does the Future Hold?

Safety is important to the government and automotive manufacturers. For the latter, it results in higher sales figures and for the government, vehicles equipped with automatic emergency braking, lane departure warning, and blind spot detection are ideal for road and public safety. Accordingly, the two entities have agreed on a target to get most cars equipped with automatic braking by 2022.

There are expectations that when safety technologies become more popular, their price points will naturally decrease. There is no longer a notion that such inclusions are only reserved for luxury or expensive vehicles. Major car manufacturer Toyota has announced that automatic braking will become standard on their new models by December 2017.

So while many car owners don’t see a reduction in their premiums now, experts are convinced that insurers will not be able to avoid the effect of safety technology and the reduction in car accidents. Accordingly, it will not be long before insurance discounts become mainstream.

Injured? Call Staver Accident Injury Lawyers Today

At Staver Accident Injury Lawyers, P.C., we possess years of experience helping clients recover compensation for injury or loss resulting from the negligent actions of another party. You cannot avoid all accidents and despite your best intentions, you could still become a victim of a serious car accident. At Staver Accident Injury Lawyers, P.C. we can help.

Call an injury attorney today to schedule a free consultation.

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