Could The Google Car Spell The End Of Insurance
The Google driver-less car, or "self-driving car" is a project by non other than Google of course, with the aim to provide completely autonomous motor vehicles excluding the need of a driver, thus you become a pilot instead. The cars will become available to the public in 2020, most likely opening first of all in the american market.
What does this mean then for car insurance. Automated cars reduced the risk of road traffic accidents, but this isn't the main cause for concern in regards to automation. It begs the question: if cars are automated, who is to blame in the rare event an accident does occur?
An estimated 90% of all road traffic accidents are related to human, rather than manufacturer error. Take away the human component and you essentially become a pilot looking monitoring key systems and taking manual action only when required. The problem is, if the robot makes the mistake, insurance companies are going to initially have to pay out the victim and their own client, as the accident was not their fault as they were not technically driving.
How then do the insurance companies claim this money back, and where from? In a typical road traffic accident of today, the at-fault party will cover the legal costs and damages to the claimant. In this case, there is no evidenced at-fault party. You can't claim against a robot.
In the event of an accident, it would be left to the court to decide who is liable to pay the claim. In the meantime, as this would be a lengthy process, insurance companies may be forced to pay interim payments and recover the costs at a later date when the court decides who is at fault.
The problem is born by the fact that an automated car will have parts, software and servicing from different companies and people. Do you hold the manufacturer liable, the software developer, or the last person that serviced the car?
We are also all painfully aware that systems, no matter how complex, can be hacked. What if someone was to hack the controls of the car and cause it to crash, or remotely control it for other purposes. This certainly poses a massive security concern.
One thing is certain, insurance companies are going to need to adapt to ensure that they are ahead of the game when automated vehicles become available to the masses, this however is probably years and years away.
Michael O'Hara, 07 August 2015