We are well on the road towards driverless cars or fully autonomous vehicles (“AVs”), which will dramatically transform how we drive. The technology is well advanced and we already see automated features built into new cars such as automatic braking, adaptive cruise control, and lane-drift prevention. The test driving of fully AVs (i.e. which require no human intervention other than setting the destination and starting the system) has been underway for a number of years and will be on the market as early as 2020.
Autonomous driving will disrupt many industries, with potentially the most significant disruption to the motor insurance industry. Reports say that 90% of accidents are caused by driver error and fully AVs will decimate accident frequency. Undoubtedly accidents will continue, but they will have different causes, for example bad weather, animals running onto the road or the technology in the car failing.
The key question is who will bear liability for accidents in this new era and what role, if any, will the motor insurance industry play.
AVs and the Irish legal landscape
The existing Irish legislative and regulatory framework for motor insurance in Ireland is driver centric. At present, under the Road Traffic Act 1961 driving is defined as ‘managing and controlling’ a vehicle. This is not appropriate for AVs where the technology, and not the driver, controls the vehicle.
As AVs will likely, at least in the short term, have both manual and computer control, it is easily foreseeable that both personal motor insurance and product liability insurance may be required. When accidents occur, it will be necessary for insurers to determine whether it was the technology of the AVs or the individual driver, who was in control. Claims could therefore be made against a driver, owner of the AV, AV manufacturer or technology suppliers such as software designers or programmers. From an injured party’s perspective, this could result in protracted and costly litigation in order to secure compensation.
The Irish legislature has not, as of yet, considered this impending development in any meaningful way. In late 2015 the European Commission established a High Level Group on the Automotive Industry (“GEAR 2030”) to formulate an action plan for AVs on a harmonised basis across the EU. GEAR 2030 outlines how in the short term, the legal position for liability in relation to vehicles with higher levels of automation would not be
significantly different to those driver centric provisions presently in place. The paper does accept that liability in respect of AVs (i.e. totally driverless vehicles) does require clarification.
UK legislature is in the fast lane
The motor insurance industry in the UK has faced these difficult issues head on and has been collaborating with the technology developers in order to fully understand the risks and design appropriate new products. Considerable progress has been made and in February 2017, following extensive engagement with the motor insurance industry, the UK Government published the draft Vehicle Technology and Aviation Bill [1]. It proposes to extend compulsory motor insurance to cover AVs when they are operated in automated mode via a single insurance product that would cover an individual driver when driving and the AV when in automated mode. The Bill provides that where “an accident is caused by an autonomous vehicle when driving itself” and the vehicle is insured, the insurer is liable for that damage. It will, in effect, be the insurer who steps into the shoes of the AV manufacturer avoiding the need for claimants to make complex product liability claims against AV manufacturers. While arguably akin to strict liability, the insurer would then have a right of recovery against other parties, such as the AV manufacturer responsible for the AV’s failure or the hacker who took control of the AV (although it is unlikely in practice that an insurer could exercise its right of recovery against a hacker, even if the hacker has been identified).
The insurer’s liability under the Bill does provide for an exclusion for damage suffered by an insured person where the accident is a direct result of alterations made by the insured person, or made with their knowledge, which are prohibited by the policy, or as a direct result of a failure to install software updates to the AV’s operating system.
The motor insurance industry in the UK has largely welcomed the proposals and it is certainly consumer friendly, as claimants can gain quick access to compensation and a full apportionment of liability will take place in the background between the insurers and AV manufacturers.
The Irish legal landscape will require adaptation to allow for AVs, however as long as traditional motor vehicles remain on Irish roads, the existing position will need to be retained.
[1]. https://www.publications.parliament.uk/pa/bills/cbill/2016-2017/0143/ cbill_2016-20170143_en_2.htm
