So what happens to insurance and personal liability when we start to see AVs on the road?
Well, besides changing the insurance agency big time, liability will be left up to the courts. But before we get to that, did you know:
- Tesla Autopilot has cut wrecks in vehicles by 40% – in response Tesla is starting to sell their own insurance in Australia and Hong Kong, because they don’t feel like insurance agencies are properly valuing their new safety.
- Several automakers (Mercedes, Volvo, Google) have said they will accept responsibility for wrecks if their systems fail
Ok, on to the legal stuff:
In non-legalize: generally when there is a wreck, whoever is at fault is responsible for it. So if someone drives crazy, they are responsible. If Tesla promises their system will work and it doesn’t, Tesla is responsible. And on a case by case basis, the court system will figure this out exactly.
Additionally, we should consider that there should be less wrecks, and while the current wrecks do involve more expensive vehicles currently: 1) damages for equipment are less than bodily injury for stuff like fatalities and 2) AVs are likely to get a lot cheaper. So in a future where there are less wrecks, theres less need for insurance all together and so whoever has to pay for it (the OEM, or the user or a society wide policy) should hopefully not experience too much of a financial burden.
So whats the take away: if the manufacturer of the AV is liable for any wrecks that happen due to their failed system, why would they ever let you have one?
you could somehow mess up the system, or perhaps you miss a key update or perhaps a sensor under-performs because you don’t clean it. A much safer play is for the OEM to retain ownership of the vehicles and just sell you rides.
That way they can make sure everything is working correctly every day. This is part of the reason we see heavy interest in Ridesourcing companies from traditional OEMs.
If you want a more complex answer in legalize (and specific to Texas), read on, otherwise
until next time,
In legalize (I am a Texas Lawyer after all): In Texas, there is a well-defined product liability statute and well settled tort law that would likely be extended or reaffirmed to cover issues with autonomous systems. This statute provides a rebuttable presumption of non-negligence if a product meets a federal safety regulation. In addition, Texas is a modified comparative negligence state, which means that if someone is more than 50 percent responsible for a tort, they cannot recover damages for their injuries. For instance, in a semi-autonomous situation, if the auto manufacturer can show that the driver should not have enabled semi-autonomous control due to inappropriate conditions, there is a chance that the negligence of the driver will rise above this threshold and preclude any recovery from the automaker. However, if the driver of the vehicle can prove that his fault did not rise to more than 50 percent of the total fault and that there was a safer alternative design and that the defect caused the injury, the driver should be able to recover against the auto manufacturer. If a third party is involved, they too will have to undergo a similar process. If they can prove that, in total, their responsibility for any accident is 50 percent or less they will be able to recover against the driver and/or the automaker. While there are already existing applicable laws, the exact lines of liability in these instances may develop over several years of rulings in various courts and jurisdictions in Texas.