Insurance Industry To Kill Self-Driving Cars, Or Itself?

If you have a self-parking car and you crash and you didn’t upgrade the software, you will be responsible.

The Government are proposing to leave it open for insurers to come after you if you don’t upgrade your car’s software.

In the new ‘Vehicle Technology & Aviation Bill’ if you fail to install updates you know you need to under the policy, (a condition we imagine for example, ‘to keep all software up to date’) then if an accident occurs, you are responsible. It’s bonkers.

What if the updates are released on US time? What if there’s not enough bandwidth to upgrade when you need to? What if the network is down? What if you have to drive to work because your work is essential? This is the very opposite of the legal certainty that the tech world needs.

The draft bill also sets out that, notwithstanding that we know it is non-self driving cars that are less safe, if there is a failure and the insurer pays out for a self-driving car, they can come after others: no doubt the manufacturer. So what exactly are you paying for insurance for?

Elon Musk and Tesla have repeatedly demonstrated that self-driving cars are safer than if you drove the same distance with human drivers. The impact of this is that per mile,  ‘Auto v Person’ there are less crashes. Fewer claims. Lower cost to the insurer. Self-driving cars are safer. End of discussion.

This is not a remote issue. Ford Fiesta (and Focus), Nissan Qashqai, Vauxhall Corsa, VW Polos (and Golfs), Audi A3 are just some of the popular cars that already have self-parking options. If you have a ‘regular’ version and crash in the supermarket carpark, you are insured. If you click the ‘self-park’ button and crash, expect a forensic investigation as to whether you upgraded your software. How is that going to encourage self-driving technology at all?

If your self-driving car doesn’t crash because self-driving cars are safer: no claim. If you didn’t update the software, it’s your fault: no claim. If the manufacturer didn’t get it perfectly right the insurer will sue them: no claim. No wonder The Association of British Insurers “welcomes the release of the Vehicle Technology and Aviation Bill’. I bet they do – what risk are they actually insuring?

Many in the legal industry are all too aware of the strength of the insurance lobby but without a change to the bill has the insurance industry actually gone too far, even for its own self interest? Why should their clients take on the additional responsibility of updating software? Why should the manufacturer not take advantage of the lower crash rates whilst being burdened if something is imperfect?

You see, if insurers want every which way out of paying, if they want all of the benefits of technology and none of the burden of responsibility, then aside from the fact that this does very little to encourage technological development, others will step in. And they have.

In February 2017 for the first time Tesla as a manufacturer offered customers in Asia a one price deal including, along with maintenance, insurance. Not fools rushing in where angels fear to tread but the creators taking commercial advantage of their own technology.

With self-driving technology comes real opportunity. The thinking behind this bill is outdated and does little to encourage the use of life saving technology and, in pandering to the insurance lobby, creates a by-product in legal uncertainty for consumers when they come to claim.