It is no longer a question of if but when autonomous vehicles (AVs) will hit the road. Vehicles with varying levels of self-driving capability will become available to consumers soon. These range from single-lane highway driving to autonomous valet parking to traffic jam autopilot.
Aggressive players in virtually every segment of the automotive value chain have unveiled, or are conducting pilot programs of, partially or fully autonomous vehicles or enabling technologies in locations around the world. Audi, for example, presented its highly autonomous A7 model. It has highway driving capability. The car had driven itself from Las Vegas to the show from San Francisco – a distance of 550 miles.
BMW has tested its autonomous Series 2 model on closed tracks and city streets. Daimler is testing fully autonomous vehicles in the U. S. and Germany. Tesla and GM plan to roll out models capable of hands-free highway driving. Nissan has already tested its Autonomous Drive technology. It enables highly autonomous functionality, on public roads in Japan.
Volvo and various Swedish government bodies in 2014 launched the “Drive Me” initiative, in which 100 self-driving cars navigate public roadways in everyday conditions in and around the city of Gothenberg. The project’s first test cars are already on the road. The prototypes of Google’s AVs have been widely publicised.
Meanwhile, Wageningen University, in the Netherlands, plans to introduce a driverless taxi later this year. The vehicle will operate between campus locations. Milton Keynes, a planned community in the UK, is developing self-driving “public transport pods”, for rollout in 2017. 500 people tried out self-driving buggies that lined the paths of the gardens in the city’s Jurong Lake District.
The city will begin testing AV jitneys that will convey people for short distances at low speeds in another part of town. The object of the test is to observe how AVs perform in real traffic conditions on public roads.
Suppliers are preparing for the AV future as well. Bosch, Continental, Delphi Automotive, Mobileye, Valeo, Velodyne and Nvidia, to name a few. They are among the suppliers that are in the advanced stages of testing the positioning, guidance and processing technology needed to make AVs a commercial reality.
Consumers perceive how AVs could make driving safer. They could exert downward pressure on their insurance, repair and maintenance cost. Respondents said that they’d buy a partially autonomous vehicle in the next five years. They cited lower insurance premiums. In addition increased safety and hands-free highway driving would be the leading reason for doing so.
Most accidents are caused by human error. If this factor can be minimised by taking control of the moving vehicle away from the driver, the accident rate should tumble. Data from the Institute for Highway Safety (IIHS) already show a reduction in property damage liability. In addition collision claims for cars equipped with forward collision warning systems, especially those with automatic braking. The exact percentage varied depending on the car manufacturer.
Some aspects of insurance will be impacted as autonomous cars become the norm. There will still be a need for liability coverage. Over time the coverage could change, as suggested by the 2014 RAND study on autonomous vehicles. This will occur as manufacturers and suppliers and possibly even municipalities are called upon to take responsibility for what went wrong.
Insurance is state-regulated. Each jurisdiction has its own set of rules and regulations for auto insurance (and so far for self-driving cars). Basically, there are two types of liability systems. In some states liability is based on the no-fault concept, where insurers pay the injured party regardless of fault, and in others it is based on the tort system.
Will the auto insurance system change to be more uniform with the arrival of self-driving vehicles and will the federal government play a larger role?
Initially, many of the traditional underwriting criteria such as the number of and kind of accidents an applicant has had, the miles he or she expects to drive and where the car is garaged will still apply. However, the make, model and style of car may assume a greater importance. The implication of where a car is garaged and driven might be different if there are areas set aside, such as dedicated lanes, for automated driving.
During the transition to wholly autonomous driving, insurers may try to rely more on telematics devices, known as “black boxes” that monitor driver activity. Some drivers may object to them based on concerns about privacy. Usage-based insurance policies which depend on data about the driver’s behaviour submitted by an electronic device in the driver’s car, have attracted a smaller than expected percentage of the driving population, possibly because people do not want to be monitored.