Who is liable for a driverless auto accident?
Although there are many evolving factors, specific areas of liability will likely remain the same.
Once imagined as part of a distant future, autonomous vehicles are now quickly rising in prevalence. As it does in most industries, the development of new technology has far-reaching insurance implications. When it comes to autonomous vehicles, one of the biggest questions is regarding liability. Without a live driver controlling the wheel, who is at fault?
The question of fault can often be complicated for accidents involving manual vehicles. Now, with autonomous driver technology, determining which party is at fault has become an even more convoluted point of contention.
The federal government has issued voluntary guidelines, leaving regulation to the states. In conjunction with the U.S. Department of Transportation, the National Highway Traffic Safety Administration (NHTSA) most recently released “Preparing for the Future of Transportation: Automated Vehicles 3.0,” where it states that they also expect the definition of an operator of a vehicle to be determined on a state-by-state basis.
Moreover, according to the National Conference of State Legislatures, there are currently 29 states, plus Washington D.C., that have enacted legislation related to autonomous vehicles. While this is up to interpretation, the generally accepted definition is that the person who started the vehicle with the intent to drive is the operator. It is critical that brokers educate themselves on state-to-state differences and are able to explain key variations to customers.
While there may be significant variance in the legislation surrounding autonomous vehicles, one widely accepted scale has been created to rank them. In 2018, the Society of Automotive Engineers (SAE) released a six-tier scale for judging an autonomous vehicle’s functionality. On this scale, zero is a vehicle with no automation, and five is one that can consistently perform all driving functions without the need for any human input. While more advanced vehicles are being developed, no commercially available vehicles higher than level three exist today.
Beyond the current state of affairs, there are still many questions up in the air regarding liability, including What will change? What will remain the same? What are the biggest unknowns?
Evolving factors
Software
As technology evolves and the number of autonomous vehicles on the road rises, the filing process and determining liability will likely undergo several changes. For example, if a software error or malfunction is present during the time of the accident, could the case be made to tie the accident back to a manufacturing defect?
Currently, with the technology so new and incidents few and far between, there is not enough case law to determine the outcome. Because software is not a physically produced item like tires or brakes, legislation may find that product liability by way of manufacturer defect cannot be claimed.
Although manufacturing errors are possible, user errors are more likely. If an issue is caused by software that the user has failed to keep current, the liability in most cases will fall upon the owner. That being said, some manufacturers – like Volvo – are ahead of the game and, in a show of confidence, are accepting all liability for incidents that occur while their vehicles are in autonomous mode.
Data
Data will also contribute to the determination of liability. With the increase in safety features — like lane assist, crash avoidance systems and drowsy driver detection — there is more data available to auto insurance companies, manufacturers and consumers.
A recent case involving Uber proved how available data could be used. In 2018, a self-driving Uber SUV hit and killed a pedestrian who was crossing the street in Arizona. To better determine the sequence of events, the National Transportation Safety Board reviewed the data gathered by the features within the car. By analyzing the available information, they saw that the person involved in the accident was jaywalking, and, due to a lack of reflective clothing during a nighttime incident, went unseen by the vehicle’s systems. In the end, Uber was not found criminally liable for this incident.
What will stay the same?
Although there are many evolving factors, there are areas of liability that will likely remain the same.
For instance, the chances of uniform state laws regarding autonomous vehicles are fairly low. This is similar to conversations around the country regarding universal healthcare. More likely, insurance companies will release language and policy that is recommended, but it will be left to individual states to create and implement legislation regarding this issue.
Then there is the question of fault and how autonomous vehicles will impact fault laws. Currently, in the vast majority of states, liability lies with the at-fault driver, and they are responsible for paying out the damages. The extent of the payout varies depending on the state’s definition of negligence. Some states have “no-fault” laws where Personal Injury Protection (PIP) insurance is mandatory, and each driver’s PIP would pay for their own damages, regardless of who is at fault. This will likely remain the same when analyzed in the context of autonomous vehicles, and fault will be determined based on state definitions of negligence.
The biggest unknowns
When it comes to autonomous vehicles, there are many unknown factors, including cost, the extent of innovation, ridesharing and vehicle hacking.
Cost
In terms of costs, there are two factors at play. On the one hand, there is the fear that, due to more expensive technology and parts, accidents involving an autonomous vehicle will inherently be more costly to insure. On the other, there is the idea that if autonomous vehicles do their jobs successfully, there will be significantly fewer accidents, contributing to an overall decrease in insurance costs.
Roadblocks to innovation
Hypothetically, manufacturers could reach a point where the increase in autonomous vehicles and safety features are no longer worth the rewards that drivers are gaining. While manufacturers have been at the frontline when it comes to the push for added safety features and autonomous/partially autonomous vehicles, there is also the potential that implementing autonomous technology stops being profitable at some point. For instance, with all the new data that comes with automotive tech, manufacturers could eventually expose themselves to more liability than ever before. These data points could reveal flaws in the system that would not have otherwise been found, which could result in them being held liable in certain situations. If the data reveals too much, manufacturers may start pulling back.
Rise of ride-sharing
There have already been instances of accidents with autonomous vehicles that tie back to ride-sharing companies, such as the aforementioned Uber accident in Arizona. These incidents add yet another layer of intricacy to the claims and liability discussion because the parties are no longer only driver and manufacturer, but also the ride-sharing company.
Vehicle hacking
Cybersecurity extends into the world of autonomous vehicles as well. With more technology involved, there is heightened fear that the potential for hacking increases. Insurers will need to adjust plans to cover all aspects, including theft, ransomware, hacking and the misuse of personal information. Blockchain technology, which allows for digital information to be distributed but not copied, will be a critical factor in protecting companies and individuals against cyber threats to their autonomous vehicles.
The end of the road
There’s no question that many factors will impact the insurance world as the rise of autonomous vehicles becomes our reality. Questions of liability and coverage are sure to evolve as the technology changes and develops, and new precedents in case law will be set as incidents arise. At this point, given that manufacturers of autonomous vehicles continue to stress that the operator of the vehicle must remain fully engaged at all times, liability will continue to fall primarily on the operator. Claims attempting to hold the manufacturer liable are likely to fail. However, this may change if vehicles become fully self-sufficient and do not need a driver behind the wheel. This reality is further away, though.
Insurers must keep abreast of the latest innovations and remain active when it comes to influencing the public policy framework. Agents will need to work hand-in-hand with legislative bodies to ensure that insurance-specific components are incorporated into autonomous vehicle regulation to address liability standards, data governance and more.
Regardless of what changes and what remains the same, what is certain is that autonomous features have already started to change our perceptions of mobility. The insurance industry will inevitably evolve with these shifting perceptions.
Rick Moore (rmoore@bbins.com) serves as national segment leader for personal and small commercial lines at Brown & Brown Insurance, one of the largest insurance brokerages in the nation.
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