Driverless cars will shift liability

The nature of motor insurance will be shaken up by the rise of autonomous and semi-autonomous vehicles, according David Powell of Lloyd’s Market Association (LMA).

LMA’s non-marine manager claims that advances in vehicle technology will reduce private car ownership and cut vehicle accident rates. He said this will disrupt current motor insurance models and force insurers to rethink their approach.

Research firm Thatcham has also claimed that the number of vehicle write-offs in the next decade will fall by almost a fifth (18%) thanks to advances in vehicle technology.

“These vehicles mean fewer collisions, which will take place at lower speeds. Removing the driver removes eight out of ten of the most common causes of vehicle accidents,” Powell said.

He added that if passengers are not driving the vehicle then this also creates a shift in responsible in the event of an accident.

“The law says if you are in control, you are liable for any injuries or property damage you cause. So, if a vehicle cannot be driven by its occupant – for example, it has no steering wheel or controls – then it becomes a product liability issue,” he said.

“The difficulty for the insurance market is going to be the transition between the current model and that which will be required in the future. Right now, we’re not able to say how that’s going to work,” Mr Powell added.