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Driverless cars are coming to the UK

Volvo has plans to bring driverless cars to the masses and will start a public pilot program from 2017 in London.

Håkan Samuelsson, CEO of Volvo Cars, said that 90 percent of car accidents are caused by human error and hopes that autonomous vehicles will solve that problem. The chief executive explained why Volvo wanted to test the vehicles in the U.K. capital.

"We have the technology, but we want to test it also in a market where it really makes sense and I can't think of a better place than London because here it seems to be very congested," he told CNBC.

A Volvo XC90 Drive Me test vehicle
Volvo Car group
A Volvo XC90 Drive Me test vehicle

Samuelsson doesn't expect all drivers to switch to self-driving cars. He said the market will be mixed between autonomous and manual cars as many people enjoy the driving experience, but believes self-driving cars will appeal to commuters.

"Sitting an hour a day going to work in congestion, maybe it's not that amusing," he said. "I don't think it's very exciting sitting in a queue and that's exactly the situation where I think there is a commercial need or desire for such a product."

In a press release published this week, Volvo warned the car insurance industry that autonomous cars will wipe away huge sources of revenue. They predicted that the number of car crashes will drop 80 percent by 2035 and premiums will reduce by $20 billion globally by 2020.

"The medium to long term impact on the insurance industry is likely to be significant. But let's not forget the real reason for this – fewer accidents, fewer injuries, fewer fatalities," Samuelsson said in the press release.

However, Volvo's predictions may be optimistic and it might take longer for autonomous cars to become widely used.

"Fully driverless cars are still some way off, and there are lots of practical and legal issues that need to be worked through," a spokesperson for insurer Direct Line Group told CNBC in February via email.

"In the meantime, many of the technologies will become common in the coming years, like semi-autonomous braking. This should reduce serious accidents."

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