Our answers to 11 questions the insurance industry must answer
TechWorld.com recently published an interesting article about the 11 questions it thought the car insurance industry must answer when it comes to driverless cars. So we thought, as a leading car insurance broker, we should do the decent thing and reply! This isn’t on behalf of the industry as a whole, but it is our take on what the answers might be and how the insurance industry might respond to the introduction of driverless cars.
1. What happens when driverless cars create accident-less cars?
There is no guarantee that driverless cars will lead to no accidents. A reduction yes, but complete elimination? This isn’t likely in the foreseeable future. The technology is emerging and evolving and still being tested and until it’s working in the field, it’s not possible to foresee to what extent accidents will be reduced and in what way driving behaviour will change.
Depending on how the technology evolves and how quickly governments adapt the law, there might be a long transition period, perhaps of a few decades, where manual and driverless cars co-exist on the roads – a state which has never existed before – so no precedent exists which can be used as a reliable indicator of what might happen in future. How will the two types of technology interact? No one can predict for sure.
2. Will there have to be a person present in the car at all times?
This isn’t something the insurance industry can or should dictate to everyone else. It will at least involve the government and companies developing the technology or offering it as a service. Given that some companies want to deploy fleets of driverless taxis, it’s self-evident that for some of the time there won’t be any human in the car. Is that acceptable or desirable? Those are different questions.
In terms of who or what is liable when there is no human present in the car, insurers may indeed decide that the company creating, managing or delivering the software (or other systems) that allow the car to drive are liable at various points while it’s in operation. Our own driverless car policy, for instance, is aimed at existing owner-drivers which means a human driver must be present who is permitted and capable of driving and taking control at any point during their journey.
3. What about differing levels of autonomy?
In other words, at what point will a human be liable? This is something we’ve covered before on our blog. Many of today’s cars have autonomous functions that react on behalf of the driver, without their awareness or explicit consent, but the human is still liable.
The UK’s road’s minister, Andrew Jones recently outlined how the insurance industry will adapt to the introduction of driverless cars and the question of liability by saying, “…in the event of a serious collision in driverless mode, it would be the vehicle at fault, instead of the human driver.”
As we move towards a state where the car is doing all of the driving for a given period of time, it may be more appropriate to assign liability to the original equipment manufacturer or other third parties involved with ensuring the car’s driverless features or systems are in good shape.
Companies, like Volvo, may also come forward and proactively offer to take responsibility too. It’s not something the insurance industry should answer on its own. Deciding liability needs to be a collaborative effort.
4. Will drivers need extra training?
Possibly. Not only to ensure they know how to activate or deactivate the driverless features (whether or not they own the vehicle), but to know what their responsibilities are during their trip. If there are no driverless features to activate or deactivate then people may still need training to make sure they’re aware of what they can and can’t do while they’re being driven.
5. Should driverless cars advertise the fact they’re driverless?
If it becomes a legal requirement, then yes. If it can be shown that people will feel more confident, safer and more informed around them, then with or without a law in place it may be helpful to make clear to a passenger or other road users what type of car it is.
This isn’t the case now though. Cars have a multitude of different features which differentiate them from each other but these aren’t advertised. If merely knowing a car is driverless doesn’t facilitate better road safety, or it reduces safety, then it may be more appropriate not to publicise the type of technology the vehicle is using.
If this question is about helping people to make informed decisions about which type of car to buy or hire, then the type of the technology it’s using (manual or driverless) should be made clear at the point of interest.
6. Will insurers pay out for a hack?
This will probably be for each insurer to decide for themselves. Our driverless car insurance policy provides cover for loss or damage (for a privately owned car in driverless mode) in the following situations:
- loss or damage caused by a hack or attempted hack of an operating system, authorised software or navigation system;
- loss or damage caused if a security patch, firewall or operating system update has not been successfully installed in the vehicle within 24 hours of the owner being notified by the manufacturer or software provider;
- loss or damage caused if updates to electronic mapping and journey planning software have not been successfully installed within 24 hours of the owner being notified by the manufacturer or software provider;
- loss or damage caused by satellite failure/outages that affect navigation systems;
- loss or damage caused by manufacturer’s operating system failure or authorised software failure.
- loss or damage caused by failing when able to use manual override to avoid a collision or accident in the event of operating system, navigation system or mechanical failure.
7. Will driverless insurance premiums differ depending on cost of car/manufacturer?
Potentially. As with existing cars, no two driverless cars are likely to be identical, from a technological point of view, even if they meet the same standards. If one car goes above and beyond the legal standard, there may be a different insurance premium associated to that.
8. Will insurance companies have access to a driverless car’s black box?
Determining liability will depend on having access to the right information at the right time – as it does today. Part of that will involve having access to any data that could help everyone involved clearly understand the events leading up to an accident. This doesn’t necessarily mean having constant or automatic access to all driverless data or systems, only access to the particular data at specific times that will help us understand what happened so we can assign liability and calculate premiums accurately.
9. If there is a crash – who will make sure the driverless car’s autonomy still works?
This is, of course, dependent on the nature of the crash and the damage caused, but in essence it could work in a similar fashion to today: specialist recovery vehicles and roadside assistance personnel could be dispatched to the scene. To an extent, the diagnosis of what damage has occurred may be possible via the car’s technology and, potentially, self-repair or remote repair may be possible.
10. How will required driver reaction times change?
In terms of our driverless car policyalert and be ready to take control of the vehicle when requested or if they think they should, or want, to take control back for any reason at any point. In other words, no, they shouldn’t switch on the “autopilot” and fall asleep at the wheel.
If we’re talking about a situation where there is no steering wheel and no functional way for a person to take any kind of control, then it will either be unnecessary to react (because it won’t be possible) or the passenger may be required to take another action e.g. to pull an emergency lever of some description, as you can on the Tube.
11. How will Brexit affect driverless cars?
Another $64million dollar question. Who can say? There are many unknowns about what will happen if the UK leaves Europe. However, if the UK is not part of the EU then it may not be involved in the process which develops the EU’s policy and/or regulation that applies to driverless technologies. If it’s not, the UK may still end up being affected by any future EU policy, regulation or law and may have to incorporate it to some extent into UK laws.
Whatever the outcome, the UK will be discussing and negotiating either as part of the EU, or with it from the outside, and with other non-EU countries too. The standards and laws surrounding driverless cars will need to be harmonised with other countries regardless of political association for them to be effective and to allow the technology and market to evolve to everyone’s benefit.