New ISO study: ADAS impact comes into focus

December 3, 2018 / 3 min read

Many insurers are asking themselves how newer advanced driver assistance systems (ADAS) affect vehicle risk as they seek to improve rating segmentation and better align premium with risk. Will these systems decrease accident frequency? Will severity increase as damage to advanced sensors drives up repair costs?

ADAS updates

ISO’s personal lines actuaries analyzed a comprehensive dataset of voluntary market premium and loss data, including vehicle build sheet data, which enabled them to measure the effects of ADAS on vehicle risk. Individual ADAS features were combined into four groups based on the technology's interaction with the vehicle and the driver. The table below lists the ADAS features used for this analysis and their corresponding rating groups.

ADAS Rating Groups and Features

Passive

Driving feedback

Parking feedback

Active

Hill hold

Hill descent

Brake assist

Forward collision warning

Lane departure warning

Blind spot detection

Rear parking camera

Rear parking sensor

Front parking camera ; Front parking sensor

Forward collision mitigation

Lane departure prevention

Blind spot intervention

The first group, labeled "Passive,” contains technologies whose effects interact with the vehicle without the driver’s knowledge to help maintain control or stability. These features can be triggered by the driver's actions, such as hard braking that causes the vehicle's brake assist feature to apply maximum braking force. These features can also be triggered by a vehicle's internal sensors, such as a pitch sensor that detects the tilt of the car's body.
The second group, labeled "Driving feedback," contains technologies that provide audible and/or visible feedback to the driver. These features use sensors and/or cameras to monitor the vehicle's external environment and trigger a warning, relying on the driver to avoid or mitigate a collision.
The third group, labeled "Parking feedback," contains technologies that provide audible and/or visible feedback to the driver during parking maneuvers. Like driving feedback features, these use sensors and/or cameras to monitor the vehicle's external environment and provide a warning; the driver must react to avoid or mitigate a collision.
The fourth group, labeled "Active," contains technologies that use sensors and/or cameras to monitor the vehicle's external environment and will alter the vehicle's movement (through turning or braking) without driver response in an attempt to avoid a collision.

ADAS reduces frequency

ISO’s findings indicate that depending on the coverage, the effects of certain ADAS groupings result in discounted rating factors being applied, which will likely be welcome news to consumers who purchase vehicles with those features. In general, the discounts for third-party coverages are higher than the discounts for collision coverage, and property damage coverage receives the largest impact of all. Industry research has shown that the severity of collision losses can partially or totally offset the reduction in frequency due to an increase in repair costs of ADAS technologies.

The future of ADAS: Next steps for ISO

ISO staff anticipates collision experience will improve as more vehicles with ADAS features are on the road and the frequency of accidents is projected to continue to decrease. ISO plans on filing rating factors for the ADAS rating groups described above starting in the fourth quarter of 2018, with more information to be provided in future personal auto circulars.

As vehicles move toward more autonomous operation, insurers will face new challenges in vehicle rating. For example, many autonomous features may be software enabled, and thus knowing what software version is running in a vehicle may be as important as knowing what hardware is in the vehicle. ISO’s upcoming 2018 filing of rating factors for ADAS features is just the start of what will be an ongoing evaluation of ADAS technology as more experience data accumulates.