Dan Peate, a venture capitalist and entrepreneur in Southern California, was thinking of buying a Tesla Model X a few years ago—until he called his insurance company and found out how much his premiums would rise.
“They quoted me $10,000 a year,” Peate recalled.
For all the concern over accidents involving driverless cars, including Tesla’s troubles with its limited self-driving Autopilot mode, it’s easy to forget one of the supposed virtues of autonomous vehicles: They will make the roads safer.
A sophisticated array of lidar, radar and cameras is expected to be more adept at detecting trouble than our mortal eyes and ears. And computers never get drunk, check Tinder or fall asleep at the wheel.
Peate, 40, previously started a company called Hixme, a provider of group health insurance. Now, he wanted to launch a firm specializing in insurance for vehicles with automated-driving modes (and eventually, fully autonomous cars). His experience with the insurer of his old-fashioned, non-driverless car only confirmed the need.
When underwriters and actuaries price insurance on a new type of risk, Peate said, they charge more because they don’t have enough data. With so few Model Xs on the road, its safety record was, at best, opaque. But Tesla Inc. and other carmakers collect reams of data on their vehicles’ operation to improve automation.
Peate said he realized “we can get large amounts of data across entire fleets and be able to underwrite without having to wait for years of data” from accidents after they’ve happened.
It also enables an insurer to cut premiums for drivers the more they engage autonomous driving.
On Jan. 30, Peate announced the creation of Avinew, with $5 million in seed funding led by Los Angeles’s Crosscut Ventures. Its insurance product will monitor drivers’ use of autonomous features on cars made by companies including Tesla, Nissan, Ford and Cadillac, determining discounts based on how the feature is used.
Avinew has agreements with most manufacturers and is working to tie up the rest, Peate said, allowing it to access driving data once a customer gives it permission.
Deloitte, in its 2019 insurance outlook report, saw this coming. “The rise of connectivity … has generated a massive amount of real-time data and turned the insurer’s relationship with policyholders from static and transactional to dynamic and interactive.” Avinew said it expects to be writing policies later this year in select states.
The transition points to a larger, existential crisis for the multibillion-dollar car insurance industry. If nobody’s driving, why do we need auto insurance? Premiums—and company revenue—are based on a driver’s likelihood of being in an accident, as well as actual crash rates.
With more than 90% of accidents caused by human error, taking the driver out of the equation is going to mean big changes for insurers.
“This comes up in every strategic conversation,” said Michelle Krause, senior managing director in Accenture’s insurance client service group. The major carriers “are very focused on understanding the technology behind [automation] and what opportunities are available for them.”
Krause’s group, with research from the Stevens Institute of Technology in New Jersey, published a report in 2017 forecasting trouble for insurers as automation becomes more widespread.
Premiums could drop by 12.5% of the total market by 2035, the authors found, and while new insurance product lines centered on autonomous vehicles will offset some of the loss, declining premium revenue will eventually outpace gains.
The good news for the industry is that it has time. Stevens estimates that by 2035 there will be only 23 million autonomous vehicles on American roads—less than 10% of today’s total.
And as of now the technology required for autonomous features is extremely expensive to repair, meaning premiums will initially rise as more cars featuring them roll off dealers’ lots.
“When you think of all these sensors and calibration, a little fender bender could be a much more costly proposition,” said David Ross Keith, an assistant professor of system dynamics at the Massachusetts Institute of Technology.
“It’s foreseeable that insurance is a much less consumer-facing industry in the future.”
As automation reaches levels 4 and 5—fully autonomous capability with the option for a human driver to take over, and fully autonomous with no human involvement, respectively—insurance is going to change dramatically.
“It’s foreseeable that insurance is a much less consumer-facing industry in the future,” Keith said.
That’s because the driver won’t be the risky part. “Liability is likely to migrate from the individual to the manufacturer and the licensers of the software that drives the AV,” said Rodney Parker, an associate professor of operations management at Indiana University.
Accenture’s report agreed. That means insurers will be selling more policies to companies and fewer to drivers: Carmakers and suppliers of communications systems, software and sensors are going to be on the hook for the failure of their products, rather than drivers paying for not checking their blind spot.
More broadly, the nature of risk itself is going to change, said Hyejin Youn, a professor at Northwestern University. With human drivers, “uncertainty is randomness, and random chances follow a normal distribution.” If the risk is in faulty software or sensors, it becomes “more systematic.”
Nationwide is one insurance company that’s started thinking about this problem. Drivers today are rated based on factors including sex, age and driving history. “If we’re getting data from the vehicle, that rating changes dramatically and gets very complex,” said Teresa Scharn, associate vice president for product development.
Insurers are already in the data management business, of course, but “it’s getting to be an even bigger muscle that we have to flex.” Like Nationwide, Allstate is aggressively hiring experts in big data and analytics, according to its president of service businesses, Don Civgin.
Determining who’s at fault when something goes wrong could get thorny in this new world.
If the lidar goes on the blink, is that the fault of the carmaker or the supplier of the lidar? What if the driver failed to get the latest firmware update—so now it’s his fault? If a Cadillac with Super Cruise loses its internet connection, is that on General Motors or Verizon? What if the car gets hacked and redirected to a thief’s lot?
What if municipal infrastructure managing traffic flow loses its data? “As a society we’ll have to figure out who’s liable for these different things, and that will determine who’s required to insure against what risks,” said MIT’s Keith.
Youn of Northwestern sees it as a “public policy problem, best addressed in government.”
Yet these are all opportunities for the legacy insurance companies quickest to adapt—as well as startups like Avinew. Policies that protect products will become more widespread, while mobility as a service, Keith said, will mean we’ll want to “insure our safety as a passenger” as well. Without a driver, there’s no driver to insure.
Nationwide thinks the smoothest road ahead will be one on which insurers and automakers each have a hand on the wheel. “We’re working to build deeper relationships with car manufacturers,” Scharn said.
Perhaps that means mergers on the horizon between insurers and automakers? Krause of Accenture said “those conversations are going on as we speak.”
Africa: Greener, Longer Life – More Trees Reduce Premature Deaths in Cities
Tbilisi — City dwellers tend to live longer if they are in leafy neighbourhoods, according to a study that links green areas to lower rates of premature death
City dwellers tend to live longer if they are in leafy neighbourhoods, according to a study published on Wednesday that linked green areas to lower rates of premature death.
Trees in cities are already credited with cooling and cleaning the air and absorbing planet-warming gases, now researchers at the Barcelona Institute for Global Health have found they also keep death at bay.
“More green space is better for health,” said Mark Nieuwenhuijsen, director of the institute’s urban planning, environment and health initiative. “People actually live longer if there is more green space around.”
The research, which pulled data from nine other studies involving more than eight million people in seven countries from China to Canada, was the largest ever conducted on the subject, the authors said.
Researchers used satellite images to quantify how much vegetation, including trees, grass and shrubs, was within 500 meters (550 yards) of people’s homes.
Levels of vegetation were ranked on a scale under a system known as normalized difference vegetation index (NDVI).
Those involved in the study were followed for several years. Any premature deaths caused by health conditions such as heart or respiratory diseases were factored in.
The study, published in The Lancet Planetary Health journal, found that in cities from Barcelona to Perth, a 10% increase in greenery led to an average 4% reduction in premature mortality.
While researchers did not look into specific causes, Nieuwenhuijsen said access to vegetation was known to benefit mental health, reduce stress, cut pollution and encourage physical activity.
“What we need to do is increase green space in many cities … so that people can actually live a healthy life,” he told the Thomson Reuters Foundation by phone.
A “nice green city” would have between 20% and 30% of every area covered in vegetation, he said.
With the United Nations estimating two-thirds of the world’s population will live in urban areas by 2050, many cities are already looking at ways to increase greenery, according to the C40 network of cities tackling climate change.
Medellin in Colombia has planted thousands of trees to form “green corridors” along main roads, while Australia’s Melbourne was looking to almost double its canopy cover to 40% by 2040.
“Green spaces are good for cities and good for citizens,” Regina Vetter, who manages C40’s “Cool Cities Network” said in a statement.
“Trees, meadows, wetlands and other green space are also vital to prepare our cities for the impacts of the changing global climate. They reduce the risks of flooding, lower temperatures and improve air quality.”
(Reporting by Umberto Bacchi @UmbertoBacchi, Editing by Claire Cozens. The Thomson Reuters Foundation is the charitable arm of Thomson Reuters and covers humanitarian news, women’s and LGBT+ rights, human trafficking, property rights, and climate change. Visit http://news.trust.org)
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Apple AirPods a hit
Shipments of Apple Inc.’s popular AirPods wireless earphones are expected to double to 60 million units in 2019, according to people familiar with the Cupertino-based company’s production plans. This has been driven in part by “much higher” than expected demand for the pricier AirPods Pro model unveiled in October.
The $249 AirPods Pro — which offer noise cancellation and water resistance — have surpassed expectations and demand for them is pushing Apple’s assembly partners against capacity and technical constraints, a person familiar with the matter said. Multiple suppliers are competing for the business of manufacturing the Pro earphones, though some are still building up the technical proficiency. There’s currently a wait time of two to three weeks for the AirPods Pro on Apple’s U.S. website.
The most advanced form of wireless headphones is called “true wireless,” defined by the absence of a wire not just between the headphones and the music source but also between the two earbuds — and the AirPods are the category-leading example. Taiwan-based Inventec Corp. and China’s Luxshare Precision Industry Co. and Goertek Inc. manufacture the AirPods for Apple.
Apple spokeswoman Trudy Muller declined to comment on the product’s shipments.
The pickup in AirPods sales this year has been helped by the launch of two new iterations: the Pro model in October and a $199 upgraded version of the original in March. The first AirPods were released in 2016. The runway is also mostly clear for Apple to have a successful holiday season, with Microsoft Corp. delaying its rival true wireless buds until spring and Google also not launching its new model until 2020.
At the end of August, Apple was the clear leader in the global true wireless earphones market, according to Counterpoint Research. AirPods shipments have dwarfed every alternative and the Beats Powerbeats Pro, another Apple product, also feature in the top 10 sellers. While Samsung Electronics Co.’s Galaxy Buds have emerged as a recognizable competitor, Apple moreover ranked as the most preferred brand for future purchases of true wireless headphones in the U.S., the researchers said.
“Apple also edged rivals because true wireless as a category is the preferred choice over wireless earphones, due to factors like better sound quality, portability, and ease of use,” Counterpoint analyst Pavel Naiya wrote on Sept. 26.
Wearables like the AirPods and Apple Watch have become a crucial growth driver for the Cupertino company, which is adapting to plateauing iPhone demand in a mature smartphone market. In the past quarter, Apple’s iPhone sales shrunk to $33.4 billion from the prior year’s $36.8 billion, whereas the Wearables, Home, and Accessories segment — composed of the Apple Watch, AirPods, Beats, HomePod and Apple TV groups — generated $6.5 billion in revenue, growing by 54%.
Total shipments of the AirPods Pro for the year will be determined by how well and how quickly the assemblers overcome the production challenges they currently face. If the overall AirPods range hits 60 million units in 2019 as is now expected, Apple should retain its 50% share of the true wireless market, which Counterpoint expects to surpass 120 million shipments for the year.
Chilean security forces ‘intentionally’ attacked protesters to ‘punish’ them: Amnesty
SANTIAGO (Reuters) – Chilean police and soldiers backed by their commanders have carried out “generalized” attacks on people protesting over inequality with the intention of “punishing and harming” them, Amnesty International said in a report published on Thursday.
A demonstrator is pulled from his hair while is detained by riot policemen during a protest against Chile’s government in Santiago, Chile, November 21, 2019. REUTERS/Pablo Sanhueza
Erika Guevara Rosas, the rights group’s Americas Director, told Reuters that its investigative team, sent to the country to weigh allegations of excessive force and rights violations by security forces, had found evidence of abuses not normally seen outside troubled Latin American nations like Venezuela, Nicaragua and Honduras.
She said they had been “shocked” to find evidence of excessive force used in Chile, widely seen as one of the region’s most democratic and stable nations.
Amnesty said it had confirmed five deaths at the hands of security forces, as well as credible evidence of protesters being shot at with live ammunition, sexually abused, tortured, beaten, and run over. There was a repeated pattern of abuse that suggested intention, it said.
Rosas said police and army personnel had broken international law in the use of live ammunition in crowd control and its own protocols in the liberal use of rubber bullets and tear gas.
A spokesman for the Chilean police said all allegations that had been formally reported would be investigated.
The army said it had not seen the Amnesty report but that it had an “iron-clad commitment” to observing human rights, and would “actively collaborate” in the investigation into the four deaths attributed to its troops. It added that when deployed for the nine-day state of emergency, it issued “special instructions” to its forces to ensure there was no excessive use of force or weaponry.
Rosas said Chilean President Sebastian Pinera was responsible for failing to acknowledge the abuses or condemning them swiftly. She said his claim last month that “we are at war” fed “the violent repression we have seen on the streets.”
“There was an intention to punish people and this came not just from the police and military on the streets but also those under whose command they were,” she said.
“If this was punishment of the people who were protesting against government policies, then the highest levels of government, including Pinera, have a responsibility for the human rights violations.”
Pinera told reporters in a briefing at La Moneda that his government had written the rules governing use of force in Chile – and updated them in March.
“If the protocols were not complied with – and I believe that it is possible that in some cases they were not – that will be investigated by prosecutors and will be punished by the courts of justice. That’s how a democracy works, that’s how a rule of law works,” he said.
On Sunday, the president acknowledged there had been “some” excessive use of force, abuse and crime and vowed “no impunity” for police and soldiers found responsible.
Chile has seen a month of both peaceful protests and violent riots that started over anger at a hike in public transport fares and broadened to include grievances over low pensions and salaries, the high cost of living, and security force abuses.
The unrest has left at least 23 dead, 7,000 detained, over 2,000 demonstrators hospitalized and more than 1,700 police officers injured, according to authorities and rights groups. More than 200 people have been hit in the eyes with tear gas canisters and rubber bullets, doctors have said.
Prosecutors are examining more than 2,000 allegations of abuses by security forces, the head of the public prosecutor’s rights division told Reuters last week.
Reporting by Aislinn Laing, Editing by Rosalba O’Brien, Bernadette Baum and Bill Berkrot
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