There are some interesting problems with self-driving cars, some of which Mulligan points out. He believes that the superior safety and performance of self-driving cars could lead states to raise the speed limit, which could lead to more accidents.
Lots of people who need extra cash see these apps as a good way to make money by using something they already have, their car. Unfortunately, there are some serious potential problems with ride-sharing apps that their fans are ignoring.
Volkswagen is already the No. 1 selling brand of car in Europe, where it has been able to drive GM out of some of its historic markets, including Germany and Great Britain. VW is also pushing hard in the United States, where it has a constructed a plant capable of constructing up to 500,000 vehicles a year. VW also increased its US sales by 100,000 between 2009 and 2011.
The bottom line is that you should be skeptical of new business models like Uber. The geeks who think them up have a bad habit of not thinking about things like insurance until the summons server comes knocking on their door.
The total value of auto insurance premiums issued in the United States in the third quarter of 2013 was $40.9 billion. That was an increase of a little over $1 billion from the same period in 2012 when the industry had $39.1 billion worth of premiums.
The insurer can raise the premium of or even cancel one of the policies without affecting the other. A person with a bundled car and home policy might see her auto insurance payment go up after an accident, while her homeowner’s premium stays the same.
If you are riding one on the public road and a car swerves to avoid you and gets into an accident you could be held liable. If you don’t have insurance the driver or her insurance company could come after your salary, your property or your bank accounts.
The reason the grid could go down is that the transformers and power lines in many residential neighborhoods are simply not built nor designed to handle the massive amounts of electricity vehicles require.
It is hard for some people to believe, but you may still have to buy car insurance, even if you don’t own a vehicle. The reason for this is that a driver can be held liable for an accident, even if he or she doesn’t own the vehicle he or she is driving. That means you can be sued over an accident you get into driving a car you don’t own.
So some insurance companies are awash in cash and are making money. Insurance is actually a very good business. Much of Warren Buffett’s fortune was built on the money generated by insurance companies. Basically, Warren used the money policyholders invested in his company to buy other companies and get financing for acquisitions.