May 2, 2018

Self-driving car liability picture still hazy

Liability risk in the era of autonomous vehicles is becoming even more complex, after a test vehicle in Arizona earlier this year struck a pedestrian, who later died of her injuries.

The accident led Uber Technologies Inc. to halt its self-driving car operations in various US cities and prompted other autonomous vehicle developers to scrutinize their own testing, but it is unlikely to keep the technology from proliferating. Even though autonomous vehicle technology is at an early stage, it is expected to reduce human error, which causes most accidents involving conventional vehicles.

Particularly at this stage of autonomous vehicles’ development, accidents involving them are to be expected — and probably will never be eliminated. The accident in Arizona was the first fatal crash in the United States involving a truly self-driving car. No technological innovation is perfect, and the laws of physics cannot be rewritten.

What may change, however, is the nature of liability arising from accidents. A human driver has a duty of care to avoid pedestrians, and pedestrians also have a duty of care to avoid putting themselves in the path of oncoming vehicles. The initial police report from the Arizona incident suggested that the accident was unavoidable. So who is liable in such an instance? The answer will take time, as investigations by local police and the National Transportation Safety Board are continuing.

Self-driving vehicles collect and store massive amounts of data. Gathering this information, as well as any photographic or video evidence from the vehicles, is valuable in reconstructing accidents and determining liability.

But a lot still remains unclear. For example:

  • Who owns the data captured by an autonomous vehicle?
  • Who has access to this data?
  • Will an auto insurance policy apply to claims arising from the failure of the hardware or software systems that collectively operate the vehicle?

California has set forth insurance requirements for the testing of autonomous vehicles. Two of the options for manufacturers are to buy commercial auto coverage or to post a USD 5 million bond.

Autonomous vehicles present an interesting opportunity for insurance companies, because the risks they encounter do not neatly fit into existing policies. Some combination or blending of coverages may be required to meet the needs of autonomous vehicle manufacturers, owners and operators.

Case law on autonomous vehicles is also in its infancy. One of the first-ever lawsuits involving a motorcyclist and an autonomous test vehicle was filed in San Francisco in January 2018. It remains to be seen how courts will consider such cases.