Autonomous vehicles: Regulatory, insurance and liability issues

Widespread adoption of autonomous vehicles, automated vehicles or driverless cars is expected to significantly disrupt the motor vehicle insurance industry. Fundamental to regulation of autonomous vehicles is who should be liable for injury or damage caused to the owner, driver or any other person in any accident. A “single insurer” solution is adopted in the Automated and Electric Vehicles Act 2018 (UK), which extends compulsory motor vehicle insurance to cover the use of automated vehicles in automated mode. An alternative pathway is liability transfer to the manufacturer; however, this raises ambiguities in allocation of responsibility and liability where neither an identifiable human driver with full vehicle control nor a completely driverless vehicle system exists. Regardless of the final landing, increased automation will generate increased product liability claims and has potential implications for other policy types.