One of the biggest mysteries we’ll need to solve for driverless cars is how to assign liability in an accident. Some experts think car manufacturers will start taking on more responsibility, but many insurance companies are still loath to touch the subject because of the various state laws that risk complicating the picture.
But at least one insurer seems to sense an opportunity where others fear to tread. In what appears to be an unprecedented move, a British insurance company has begun offering a special policy designed for autonomous and partly automated vehicles. In theory, you could use this on your Google driverless car or your Tesla that’s equipped with autopilot.
Unfortunately, it’s only available in Britain. But the policy protects against all of the usual things you would find in your typical car insurance — damage, fire, theft. And it also goes further, covering accidents caused by malfunctions in the car’s driverless systems even if the passenger has failed to use a manual override. It covers any havoc that hackers may wreak on a car’s operating system. It applies to cars even if they haven’t been updated to the latest software. And it even covers mishaps that may occur if your car loses satellite or other crucial connectivity.
By setting out such a surprisingly comprehensive plan this early in the game, analysts say, the policy from U.K.-based insurer Adrian Flux sets a precedent that others may follow.
“It’s a courageous first step and something we’re going to see more and more of,” said Renee Stephens, vice president of U.S. auto quality at J.D. Power and Associates. “Even though it’s in the U.K., it could have a bearing on what insurers here look at, as we start to get the next generation of these features on vehicles.”
What does this mean for car owners? Potentially, it could lead to lower premiums.
Vehicle automation stands to make cars safer and more efficient; already, we have cars on the road that can prevent you from rear-ending the person in front of you and keep you from side-swiping your neighbor if you start drifting out of your lane. Fully driverless cars, particularly ones that can communicate with each other, represent another upgrade on top of that.
More than 30,000 people are expected to die in car crashes this year, with the vast majority of these collisions caused by human error. Quick-reacting computers that can make smart judgements about how to drive better will cut this figure substantially, analysts say.
Insurance is designed as a hedge against disaster; when disasters become rare, the cost of insurance will fall.
“We expect premiums for fully autonomous cars to be considerably cheaper than regular cars, purely because of the expected reduction in accidents and claims,” said Matt Ware, a spokesman for Adrian Flux. Even though that means less revenue for insurers, the lower rate of accidents means the insurance company will get to save money overall because it won’t be forced to issue as many payouts.
Inevitably, people will still want to drive by hand. And unlike Google, some manufacturers will probably continue to keep steering wheels, brake pedals and all that other machinery in their cars to serve that market. As a result, our roads will see a mix of different vehicle types, driverless and otherwise.
“Insurance premiums will simply reflect the risk factors of each of those groups in much the same way they do now, based on the claims data that will build up over time,” Ware said.
We won’t go so far as to say “save 15 percent on your car insurance by switching to driverless.” (We’ll leave that to Geico to figure out.) But the way things are going, driverless car owners may someday gain another benefit in addition to saving money on fuel, time and accidents.