Autonomous Vehicles Are Here…What Does this Mean for Purposes of Automobile Insurance Coverage and Liability for Accidents?

by Matthew J. Focht
August 11th, 2016

The era of autonomous (aka “driverless”) vehicles has arrived and with it will come unprecedented changes in tort and insurance law. 

In 2013, the District of Columbia passed an autonomous vehicle statute.  In the statute, an autonomous vehicle is defined as “a vehicle capable of navigating District roadways and interpreting traffic-control devices without a driver actively operating any of the vehicle’s control systems[1].”  However, excluded from this definition are vehicles “enabled with active safety systems or driver- assistance systems, including systems to provide electronic blind-spot assistance, crash avoidance, emergency braking, parking assistance, adaptive cruise control, lane-keep assistance, lane-departure warning, or traffic-jam and queuing assistance, unless the system alone or in combination with other systems enables the vehicle on which the technology is installed to drive without active control or monitoring by a human operator[2].”

Based on these definitions, autonomous vehicles are permitted on District of Columbia roads so long as the vehicle:

(1) Has a manual override feature that allows a driver to assume control of the autonomous vehicle at any time; 

(2) Has a driver seated in the control seat of the vehicle while in operation who is prepared to take control of the autonomous vehicle at any moment; and

(3) Is capable of operating in compliance with the District’s applicable traffic laws and motor vehicle laws and traffic control devices[3].

Additionally, the District Columbia statute addresses the conversion of existing vehicles into autonomous vehicles.  Under the statute, vehicles being converted into autonomous vehicles must be newer than the 2009 model year, or within four model years of the time the vehicle is being converted, whichever is newer[4].  Moreover, the statute limits the liability of the original manufacturer of a vehicle being converted by a third party into an autonomous vehicle. Under the statute, such original manufacturer “shall not be liable in any action resulting from a vehicle defect caused by the conversion of the vehicle, or by equipment installed by the converter, unless the alleged defect was present in the vehicle as originally manufactured[5].”

The District of Columbia is one of eight states with an autonomous vehicle statue.  The others are Nevada, California, Florida, Louisiana, Michigan, North Dakota, Tennessee, and Utah.  Other states will undoubtedly join this growing list.  Arizona’s governor has issued an executive order relating to autonomous vehicles and Virginia permits the research and development of autonomous vehicles within designated “Automated Corridors[6].”

Now that autonomous vehicles are here, what does this mean for purposes of automobile insurance coverage and liability for accidents?  Just because a vehicle is autonomous, does not mean that the vehicle is accident proof, as evidenced by the recent death of a Tesla engineer while testing an autonomous vehicle near Williston, Florida[7]

A policy recently issued by British insurer Adrian Flux provides some clues as to how autonomous vehicles will be insured.  Adrian Flux describes its new autonomous vehicle policy as a “typical insurance policy with a few extras[8].”  Such extras include coverage for “everything from getting your car hacked to an operating system failure and [a] satellite outage affecting the navigation system.  Drivers are also covered for loss or damage caused by a failure to manually override the autonomous system in the event of a mechanical failure[9].”

The Adrian Flux policy is an effort “to answer the most pressing question affecting insurance and autonomous cars: who is liable in the event of an accident?  It depends on the condition of the car, the driver’s level of awareness, road conditions, and other vehicles involved[.]  Customers may not bear any responsibility if the driverless technology has failed.  Drivers are on the hook for installing all necessary software on their vehicles, although they will be covered if something happens during the first 24 hours of being notified of a software update[10].”

Adrian Flux believes that autonomous vehicles will result in savings for insurance customers, likening it to assistive technology currently in the marketplace, such as autonomous braking systems.[11]  Autonomous vehicles are widely expected to reduce the number of automobile collisions taking place and to reduce the severity of those accidents that do take place.

To the extent that accidents are caused by mechanical and or computer failure, products liability law will likely come into play[12].  One concern is that the increased potential liability of vehicle manufacturers will stifle innovation and the further development of autonomous vehicle technology.  To this end, some are suggesting the establishment of a government run no-fault compensation system similar to the compensation system used for vaccine recipients suffering from a serious adverse reaction to their vaccination[13].  

 

[1]                 D.C. Code Ann §50-2351(1)

[2]                 Id.

[3]                 D.C. Code Ann §50-2352

[4]                 D.C. Code Ann §50-2353(b)

[5]                 D.C. Code Ann §50-2353(a)

[7]                 http://www.driverless-future.com/?cat=9

[9]                 Id.

[10]               Id.

[11]               Id.

 

Matt Focht is a trial lawyer in the firm’s Personal Injury practice group. He helps individuals who have been seriously injured in avoidable accidents recover the compensation they deserve in litigation before state and federal courts throughout Maryland and the D.C. area. Matt has deep experience in managing a broad range of high-stakes personal injury matters on behalf of victims and surviving family members, including automobile accidents, wrongful death cases and a variety of other serious accidents caused by negligence.

Contact Matthew Focht

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