Autonomous vehicles (AVs) are expected to revolutionize the transportation industry, offering safer, faster, and more efficient mobility. However, they also pose a unique challenge for insurance companies, as they involve a shift from human to software drivers. How can insurers assess the risk of AV deployments without a comprehensive history of claims?
SIMULYTIC, a Siemens AG venture, has developed a novel solution that uses simulation and analytics technology to create risk profiles for AV deployments. SIMULYTIC replicates, simulates, and evaluates proposed AV operations in various locations, taking into account traffic, weather, and other hyperlocal data. SIMULYTIC then calculates an Automated Vehicle Deployment Risk Score (AVDRS) for each scenario, which can help insurers price the risk of AVs consistently, transparently, and evidence-based.
How SIMULYTIC works
SIMULYTIC leverages the power of HERE Technologies, the leading location data and technology platform, to create realistic and accurate simulations of AV deployments. SIMULYTIC utilizes the HERE HD Live Map, a highly detailed, cloud-based map for autonomous systems, which contains rich information about the road network, such as lane configurations, markings, signs, and poles.
SIMULYTIC inputs the specifications of the proposed AV deployment, such as the vehicle type, the route, the time of day, the frequency, and the number of passengers. SIMULYTIC then generates synthetic driving histories of the AV deployment, simulating thousands of possible scenarios and outcomes. SIMULYTIC analyzes the simulation data and computes the AVDRS, which reflects the probability and severity of potential accidents, damages, and liabilities.
SIMULYTIC can customize the simulations and the risk scores for each AV deployment, taking into account the specific characteristics and requirements of the insurer, the operator, and the regulator. SIMULYTIC can also update the simulations and the risk scores as the AV deployment evolves, incorporating new data and feedback.
Why SIMULYTIC is needed
SIMULYTIC addresses a critical gap in the insurance market for AVs, which is expected to grow significantly in the coming years. According to a report by Allied Market Research, the global autonomous vehicle market size was valued at $54.23 billion in 2019, and is projected to reach $556.67 billion by 2026, registering a compound annual growth rate of 39.47% from 2019 to 2026.
However, the current insurance models and regulations are not designed for AVs, which have different risk factors and liability issues than human-driven vehicles. For example, AVs may have lower accident rates, but higher repair costs, due to the complexity and sophistication of their sensors and software. AVs may also have different liability scenarios, depending on whether the fault lies with the manufacturer, the operator, the software provider, or the user.
Without a reliable and consistent method to evaluate and price the risk of AV deployments, insurers may face uncertainty, inefficiency, and unfairness in the underwriting process. This may hinder the adoption and innovation of AV technology, as well as the protection and compensation of the stakeholders involved.
SIMULYTIC aims to solve this problem by providing insurers with a simulation-based risk assessment tool that can support their decision-making and pricing processes. SIMULYTIC can help insurers reduce their exposure to unknown and unpredictable risks, increase their efficiency and profitability, and enhance their competitiveness and customer satisfaction.
What SIMULYTIC offers
SIMULYTIC offers a number of benefits and advantages for insurers, operators, regulators, and users of AVs. Some of these include:
- Evidence-based risk scoring: SIMULYTIC provides insurers with a data-driven and scientific approach to measure and compare the risk of AV deployments, based on synthetic driving histories and simulations. SIMULYTIC can help insurers avoid relying on subjective judgments, assumptions, or historical data that may not be relevant or representative of AVs.
- Tailor-made simulations: SIMULYTIC can customize the simulations and the risk scores for each AV deployment, taking into account the specific features and factors that may affect the risk level. SIMULYTIC can also update the simulations and the risk scores as the AV deployment changes, incorporating new data and feedback.
- Fast and flexible coverage: SIMULYTIC can provide insurers with fast and flexible coverage for any AV deployment, anywhere in the world. SIMULYTIC can generate simulations and risk scores for any location, route, or scenario, using the HERE HD Live Map as the basis. SIMULYTIC can also provide insurers with dynamic and adjustable coverage, depending on the demand and supply of AV services.
- Transparent and explainable results: SIMULYTIC can provide insurers with transparent and explainable results, showing the details and the rationale behind the simulations and the risk scores. SIMULYTIC can help insurers communicate and justify their pricing and policies to the operators, the regulators, and the users of AVs, as well as to resolve any disputes or claims that may arise.
- Catalyst for AV innovation: SIMULYTIC can act as a catalyst for the innovation and adoption of AV technology, by providing insurers with a tool that can support and encourage the development and deployment of AVs. SIMULYTIC can help insurers create new products and services for the AV market, as well as foster collaboration and trust among the stakeholders involved.
SIMULYTIC is a Siemens AG venture that was founded in 2023. SIMULYTIC is an insurtech start-up that aims to revolutionize the insurance industry for AVs, using patented simulation and analytics technology. SIMULYTIC is currently working with several leading insurers and operators to test and validate its solution.
