Insurance for Driverless Cars

Source: bigthink.com

Vehicle insurers can expect a abrupt change as self driving autos become more popular. AI is casting a ever growing influence on how insurance premiums are derived.

Traditionally premiums were based on actuarial table outlining risk based on historical events. All this data was based on human attributes, when AI becomes the driver all this data needs to be revised and the data will not have a very long history to draw from.

Insurance policies are written to include or exclude coverage based on the fault, whether the state is a comparative state or a contributory state, the fault needs to be determined to assess damages. In a nutshell, contributory negligence is determined by investigating the accident. Each party is expected to act as a reasonable person would, if their actions or behavior differs from how a reasonable person should act or behave, they will be assigned a percentage of fault.

Under a comparative negligence state, the same investigation is required and also the assignment of fault. But the damage in monetary terms is offset and the people deemed more at fault will be required to pay the percentage offset.

Here is the crux of the matter. When dealing with an AI program, the fault may lie in the programming of the software or perhaps a faulty sensor. The method to determine cause has now expanded as it must include the examination of coding and hardware sensors. Upon reaching a reasonable cause, one must determine what percentage of blame resides with the software, the car manufacturer, the manufacture of the sensors and it may even involve external factors like a power surge or that corrupted the AI coding.

Will insurance policies be required for car manufactures, software developers and hardware manufacturers for each vehicle sold? A solution I can see might be to have all parties involved in the manufacturing and software buy performance bonds that attach to the car.

This new product greatly expands the scope of the insurance required as well as the scope of investigation needed to determine fault. This will definitely increase the pocket books of the lawyers. Just a side thought, when will they create a robotic attorney?

Source: scmp.com