Will driverless cars drive motor insurers to the wall?

SINGAPORE'S motor insurance industry has a blind spot: Driverless vehicles.

Motor insurance is the cash cow for general insurers here, accounting for nearly one-third of the general market.

In 2015, car insurers hauled gross premiums of S$1.1 billion - a 4 per cent drop from S$1.2 billion in 2014 due to stiffer competition and a drop in car population.

That decline is a lot at stake for the general insurers, with AV (autonomous vehicle) technology posing the potential to be a hugely disruptive innovation, presenting the most complex challenges to face the insurance industry.

There is no doubt great advantages to AV such as the potential creation of new leisure options for travellers, improvements in productivity for commuters and reduction of road rage. On the flip side, AV could trigger…