How will UK’s new law impact car insurance?
UK drivers have received a significant boost with the introduction of the 2024 Automated Vehicles Act.
This law outlines new policies around self-driving vehicles. It introduces a paradigm shift in liability for accidents involving autonomous vehicles, or driverless cars.
According to the new guidelines, British motorists will “not be liable” if their self-driving vehicle crashes while they are behind the wheel.
This move will probably save car insurance policies for vehicle owners, because it removes them from the equation when a driverless vehicle is involved in an accident.
Yousif Al-Ani, principal ADAS engineer at Thatcham Research, emphasized that this ruling ends speculation over driverless vehicle incidents and places responsibility on manufacturers.
The law mandates open and robust access to collision data. This ensures clarity on who was in control at the time of the accident.
This comprehensive legal framework aims to provide clear guidance on liability. It potentially leads to quicker and fairer resolutions in the event of an incident.
What will change in car insurance policies because of driverless cars?
The advent of autonomous vehicles is set to radically alter car insurance policies. As self-driving cars become more prevalent, traditional car insurance will need to evolve.
GlobalData’s ‘‘Autonomous Vehicles in Insurance’’ report indicates that liability will shift from drivers to other parties, such as OEMs, IT service providers, and software vendors.
For instance, from Level 4 autonomy onwards, vehicles will no longer have a driver. Thus, with driverless cars, the liability shifts to the vehicle itself.
Insurance products will transition to resemble product liability insurance rather than third-party liability insurance.
In practical terms, this means victims of accidents will claim against the vehicle owner’s insurance policy.
They will then seek recourse from the at-fault party, such as the car manufacturer or software provider.
This shift might decrease personal motor insurance premiums by 40% by 2040. At the same time, it will increase the market for product liability insurance by 14%.
How does the UK’s approach compare to the US?
While the UK has taken a significant step with its 2024 Automated Vehicles Act, the situation in the US is also evolving but remains more fragmented due to varying state regulations.
In the US, the approach to autonomous vehicles and driverless cars insurance is shaped by individual state laws and federal guidelines.
Moreover, the liability in the US will probably shift towards manufacturers and technology providers as autonomous vehicles become more common.
However, the complexity of state laws in the US may slow down the implementation of a uniform framework.
Insurance companies in the US start to adapt by developing policies that reflect the increased role of manufacturers and software developers in vehicle operation.
Major players like State Farm and AXA actively engage with autonomous driving technology. This way they ensure to stay ahead in this evolving market.
Both countries face challenges, including cybersecurity risks and the need for robust legal and insurance frameworks to manage the transition to autonomous driving.
However, they move towards a future where drivers are less likely to be held responsible for accidents involving driverless cars.