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$ONCI... Notes From Tony Nicely's Talk, Part II
Second part of former Geico CEO's presentation at the Berkshire System Summit
May 17, 2019

Geico CEO from 1992 to 2018.

The impact of self-driving cars:

The technology is coming, but it’s more complicated than people think. The infrastructure, the laws and regulations are both very complicated. How fool-proof will the self-driving cars be? Can you have zero defects in the complicated software? Safety is a big concern.

In 1977 or 1978, nearly 78,000 people a year were killed in car accidents on the highways. Because of safer cars, better law enforcement and a few other factors, the number of people who died from highway accidents declined to 32,000 a few years go. Today the number went back up to about 40,000. More distracted driving and more marijuana consumption might have contributed to the rise of the death rate. But it’s not just the death rate that matters to auto insurance. It’s also the injuries that have become more severe and the economic damages that have become more expensive due to much more expensive vehicles and more electronics on the vehicles. So inflation has really hit the property and casualty insurance industry, particularly on automobiles.

Nicely thinks it will take longer than people think to have 20% fewer vehicles on the road. The average age of the vehicles in the U.S. fleet has increased to more than 11 years. It’s not a very high turnover rate. Newer cars with all the safety features are much more expensive to purchase than used cars.

https://www.gurufocus.com/news/880174/notes-from-tony-nicelys-talk-part-ii