Can Auto-Pilot Change The Look Of The Auto Insurance Market?

By:  Jacob L. Johnson, Esq.

Though the future of self-driving insurance aspects is mostly unknown, the advent of crash avoidance technology may soon mean less claims for driver negligence and more products liability claims aimed at manufacturers for computer flaws. 
 
The Federal Government has made it clear that self-driving vehicles are the next level in safety.  Jeffrey Zients, director of the Economic Council, recently gave the agency approval by stating that “[W]e envision in the future, you can take your hands off the wheel, and your commute becomes restful or productive instead of frustrating and exhausting,” and added that highly automated vehicles “will save, time, money and lives.”
 
If humans are no longer driving vehicles, do they need insurance policies? And, if so, what would the limits of those policies be? For now, self-driving automakers require drivers to maintain attentiveness at all times to ensure that they are able to take over control of the vehicle should any problems arise.  However, this requirement may be quickly dissipating.  In December of 2016, Michigan passed legislation that would lift this requirement and added that in the event of an accident, the “driving system or any remote or expert-controlled assist activity” shall be the “driver” for the purposes of determining whether or not the vehicle is conforming to local laws.  Furthermore, the law requires that the manufacturer assumes liability for each incident in which the automated system is at fault.  For now, the Michigan statute is aimed at producers like Google, that are placing fleets of self-driving vehicles on the road.  As more data comes in and more driverless cars are put on the roads, these laws and new policies should start to take a more generalized and permanent shape nation-wide.  Until then carriers should keep an eye on this quickly evolving sector.