The world of transportation, like everything, continues moving forward. You've read about the insurance risks for self-driving cars. Are the insurance risks different for autonomous trucking vehicles? As these new and evolving vehicles continue to push the boundaries of what the transportation industry looks like, what will that mean for the laws that govern our operation of motor vehicles?
Legislative bodies, insurers, customers, and companies will need to be aware of changes that will likely occur. These will include what an insurance policy provides coverage for and what it does not. Legislative bodies will need to redefine various terms, such as "operation" and "driver". They will need to take into consideration that a fully autonomous vehicle is NOT a driver or operator in the current sense and legislatures will need to decide who will be held liable if an accident occurs. The courts will then need to interpret those changes as issues of first impression and decide how they will be applied.
State Trends
For example, New York State Vehicle and Traffic Law Section 125 defines a motor vehicle as "[e]very vehicle operated or driven upon a public highway which is propelled by any power other than muscular power. Interestingly, a review of definitions listed within the New York State Vehicle and Traffic law does not include the term "operation." It does, however, contain the definition of "driver." Section 113 defines a driver as every person who operates or drives or is in actual physical control of a vehicle.
In Connecticut, "operation" refers to certain actions, including any action that intentionally could set the motor power of the vehicle in motion. This can refer to doing something as simple as putting your car key in the ignition or starting the engine with a remote. The Connecticut Supreme Court held the issue of whether one operates a motor vehicle within the meaning of §14-227(a) is to be determined on a case-by-case basis, making proof of operation . . . a factual determination." Murphy v. Commissioner of Motor Vehicles, 254 Conn. 333, 344-45, 757 A.2d 561 (2000). It further held "there is no requirement that the fact of operation be established by direct evidence." Id. at 345.
In Massachusetts, a person "operates" a motor vehicle not only while doing all of the well-known things that drivers do as they travel on a street or highway, but also when doing any act which directly tends to set the vehicle in motion. The Massachusetts Supreme Court held that "A person is "operating" a motor vehicle whenever he or she is in the vehicle and intentionally manipulates some mechanical or electrical part of the vehicle — like the gear shift or the ignition — which, alone or in sequence, will set the vehicle in motion.
What if no person is controlling the trucking vehicle? When a vehicle is controlled by a computer, with hundreds of cameras, performing thousands of analyses of all possible scenarios while a vehicle travels on the roadway, you can be certain that products liability allegations will be raised. Claims of negligence, defective design, strict products liability will be alleged if an accident occurs and insurers need to be prepared for this when crafting insurance policies for trucking companies utilizing such vehicles. If the vehicle utilizes a "safety" driver, insurers will likely see a hybrid type of lawsuit, with both products liability allegations and the typical liability and negligence allegations raised in most motor vehicle lawsuits. This has already happened. In 2019, Starsky Robotics (which went out of business in 2020) "operated" a tractor-trailer on the Florida Turnpike without a person behind the wheel. It was the first company to put a truck on an open highway without a human on board.
In CA, a private, global truck company operates autonomous tractor-trailers and is developing a commercial-ready Level 4 (SAE) fully autonomous driving solution for the logistics industry. Its trucks are capable of self-driving from depot to depot. It can perform all driving tasks, under all conditions that a human driver could perform. A Level 4 solution can conduct the driving task and monitor the driving environment, but the automated system can operate only under certain conditions. Those certain conditions mean the tractor-trailer will be operated by a human driver during the initial distance traveled between an origin location, like a warehouse, and the highway. A driver will operate the vehicle during the "last mile" to the truck's final destination. The vehicle will be autonomous with a "safety driver" during the middle portion of a trip.
In Texas, another company is also seeking to use autonomous vehicle transportation to transform the trucking industry. As an example, imagine it takes three days for a human driver to drive from New York City to Miami (1,277 miles). Now imagine the vehicle is autonomous. A FULLY autonomous vehicle doesn't need to be bound by the same hours-of-service regulations that limit human commercial drivers. It's possible that an autonomous tractor-trailer could make this trip in less than 24 hours if driving at 55 mph.
These are just two of dozens of active self-driving truck companies. Larger multi-national companies like Volvo and BMW are also in the space. According to the American Trucking Association's economics and industry data, in 2019, the trucking industry generated $791.7 billion in gross freight revenues (primary shipments only), representing 80.4% of the nation's freight bill in 2019. Trucks transported 11.84 billion tons of freight (primary shipments only), representing 72.5% of total domestic tonnage shipped. That was almost three years ago. This is important from a legal and insurance perspective because it impacts what type of insurance a company will need and from a practical perspective, how much coverage.
Civil and Criminal Matters
So, what does the rise of autonomous driving vehicles mean for both civil matters and criminal matters? It means that we will see more defendants named following an accident, including manufacturers, designers, retailers, and end-users, along with "safety" drivers. We will see a rise in more complex pleadings where products liability law and allegations of straightforward driver negligence are included in one complaint. We may see attempts by the legislature to limit exposure to liability, depending on when an accident occurred, what type of vehicle was involved, and who was responsible for the autonomous navigation of the vehicle. For now, with safety drivers still present within autonomous vehicles, trucking companies need to be aware that Vehicle and Traffic laws will likely be applied to any accident that may occur. However, because a legitimate argument can be made that perhaps the technology is at fault for an accident, products liability law will also likely be applied.
This means that not only do trucking companies that purchase the vehicles have to be insured for motor vehicle accidents, but they will also need to be insured for products liability claims. It also means that the manufacturer of the technology, the distributor or retailer of the vehicles and the software designers all will need to be prepared for lawsuits if an accident occurs.
Ultimately, manufacturers, designers, distributors, retailers and trucking companies utilizing autonomous technology need to be prepared for a hybrid style of litigation within the transportation world. I anticipate that unless and until we have a fully autonomous vehicle, with no human oversight within the vehicle, operation of the vehicle will remain a somewhat human responsibility. Companies should be prepared to face causes of action grounded in products liability as well. Claims of defective design, breach of implied warranty of merchantability, strict products liability and more will almost certainly be brought against all defendants within the chain of distribution.
Legal challenges are anticipated regarding how to define the term "operation" given the nature of these vehicles. These challenges will vary from state to state based on existing case law. Unlike "operation" as it exists currently, where a human driver is responsible for all aspects of a vehicle's movement or non-movement, the very purpose of autonomous vehicles is so that a person does not have to drive. However, if there is a "safety" driver in the vehicle, are they still operating it? It will also likely lead to is massive amounts of pre-trial litigation involving significantly greater amounts of electronic data discovery and much broader demands for electronically stored information.
Despite these questions, and despite the high costs associated with developing this technology, the ultimate benefit would hopefully be the eventual demise of contested motor vehicle accident litigation. If all vehicles eventually become automated, with software that monitors speed, traffic control devices, lane changing, stop and go traffic, the ability to prosecute a dubious claim involving a motor vehicle accident becomes exponentially more difficult. No longer would a plaintiff be able to claim that a car struck him while he was in a crosswalk, slammed into the rear of his vehicle at a high rate of speed, or side-swiped his or her vehicle without the other party simply retrieving the saved data, presenting it to the court and either disproving or proving plaintiff's contention.
From budget approvals for further testing of autonomous vehicles to technology that continues to expand at breakneck speed, it is an exciting and interesting time in the transportation field. However, whereas in the past, insurers were concerned mainly with the capabilities of their clients' drivers and their ability to avoid accidents, the proliferation of self-driving vehicles will add a myriad of new wrinkles to areas of insurance within the coming years. Normal straightforward liability and collision coverage for fleets will soon need to address whether the vehicles are self-driving or not; additional sections will need to be introduced that reflect the potential liability for the technology's manufacturer, its distributor, its end-user. Ultimately, given the way the laws have been drafted to date and those laws that are being proposed, it seems likely that liability will continue to ultimately rest with a vehicle's owner or its driver, barring some catastrophic software failure.
It's a fast-moving world nowadays in transportation. As Ferris Bueller once said, "Life moves pretty fast. If you don't stop and look around once in a while, you could miss it." Insurers should be looking around. They're not going to want to miss this.
Adam Dolan is a partner at the litigation law firm of Gfeller Laurie LLP in New York City.