Assuming that 25% of the average auto premium is for comprehensive coverage, and 75% for liability and collision, eliminating that 75% will deal the auto insurance industry a crippling blow, Raburn says.

Among her predictions:

1. Insurers' primary revenue streams will shift from personal lines to commercial lines, as carriers retool their offerings to sell product liability insurance to vehicle manufacturers. “The only reason an individual would want personal auto insurance is to cover them for comprehensive coverage,” Raburn says. Because these “smart” vehicles remove the driver from the equation, pricing will be based on where the vehicle is garaged, the area's propensity to natural disasters, and exposure to theft. This narrow scope will further commoditize the product and open the market to new, unconventional vendors such as Amazon and Google.
2. The concept of “distracted driver” will cease to exist, which means fewer accidents and consequently lower insurance rates. Long-standing industry supported initiatives like drivers' education and graduated drivers' licensing programs will go away, and DUIs will become a thing of the past. Municipalities that rely on revenue from traffic offenses will have to find other sources of income, as will the “cottage industries” of lawyers and rehabilitation programs built around DUIs, Raburn predicts.
3. Vehicle owners will no longer buy collision insurance as manufacturers will be solely responsible for damage.
4. The technological underpinnings of usage-based insurance (UBI) will transition away from consumers and personal auto insurers and become a valuable tool for both automakers and their product liability carriers.
5. No- fault regulations will be replaced by tort-based product liability laws. New laws may also surface to address injuries sustained as a result of a vehicle malfunction, or perhaps vehicle-based injuries will be covered by personal insurance instead of auto insurance.

But although these observations are interesting, insurance broker and self-described futurist Keith Savino, COO of Warwick Resource Group LLC and an active member of many insurance industry technology groups, thinks there's more to the story than meets the eye—starting with what we think of as “driverless cars.”

“A lot of this is like the autopilot system in an airplane. Does 'autopilot' mean the pilot doesn't have control of the airplane?” he asks. Similarly, “driverless” could range from 100% driverless, in which the vehicle is essentially a chauffeur, to systems in which the driver can relinquish control at will, when he's tired, needs to multitask, or wants to avoid drinking drunk.

Rather than bursting onto the scene fully formed, “driverless” vehicle technology will come about gradually—and in fact pieces are already present in higher-end vehicles in the form of lane avoidance, backup warning and other sensor systems. “It's an evolutionary path, and we have to consider what the insurance industry will do at each point alone that path,” Savino says.

And we've been down this evolutionary path before–consider the emergence of airbags, anti-lock brakes, and the granddaddy of vehicle safety devices, the seat belt. While all these devices have undoubtedly improved safety, they're only as good as the driver using them—and until every since vehicle on the road is truly driverless, negligence will always be an issue.

Even if a vehicle is truly “driverless,” there's no guarantee that it can't be hit by a deer or a falling tree. “There will always be a need for some sort of personal auto policy if there can ever be negligence on the part of the owner or driver,” Savino says. “Think about the personal umbrella for your home. You don't have to be home to suffer a loss; you could have left something on the sidewalk and have an injury related to negligence.”

And as far as people giving up driving to go on total autopilot? Savino isn't buying it. “I get it that some people only use cars to get from Point A to Point B. But a lot of people just love to drive and I can't see them ever giving up that experience. The transportation industry is booming in many parts of the world where people are buying cars for the first time. I don't see the personal auto market disappearing for the independent agent; I see opportunity.”

Savino recalls the joy of driving as captured in a 1981 song by Rush called “Red Barchetta.” The lyrics depict a dystopian future where a young lad breaks the “Motor Law” and evades the authority's “gleaming alloy air cars” by roaring across the countryside in his uncle's illicit red Barchetta, “saved from a better vanished time.”

And even if the future shakes out like Rush depicted it, Savino expects one thing to remain the same: “If agents and brokers can explain things to their clients, they will still be an important part of the personal lines landscape.”