An insurance industry think tank recommends the existing auto insurance system be adapted to handle autonomous vehicles (AVs), rather than alternative approaches such as product liability.
The Travelers Institute, the public policy arm of Travelers Insurance, said in a white paper the sector is best positioned to respond to consumer needs in what’s expected to be a decades-long transition to autonomous transportation.
“The current insurance structure is already designed to adapt to evolving risk environments and would minimize regulatory uncertainty, market disruption and consumer confusion,” the 20-page report, released Monday, said in its summary.
A product-liability model has been raised as the default option for AVs, the report said, but “this presumption should be challenged.”
Product liability, used with other consumer goods, is not structured to offer primary, comprehensive solutions to claims, it said. Consumers and victims could be forced to pursue complex, lengthy lawsuits to get compensation. With collision claims the sheer number of incidents could bog down court systems and delay compensation.
The report noted it’s taken well over a decade for product-liability claims involving defective Takata airbags to proceed through the product-liability process, with some automakers still involved in litigation.
Using the existing insurance system in an AV world allow for greater speed, fairness and efficiency for claimants, the report said.
“The existing insurance structure is designed to quickly make vehicle owners whole and efficiently compensate crash victims for both bodily injury and property damage,” the report said.
As now, policyholders would have access to coverage for medical expenses, lost income and other coverage. Most are also familiar and comfortable with the existing structure for buying insurance, knowing what it covers and filing claims, it said.
As government policy makers work on developing the AV environment, any proposed regulatory structure “should explicitly address insurance-specific issues and needs,” the report said.
The existing insurance structure can adapt more effectively to the regulatory and legal environment as it evolves, creating or enhancing insurance products.
It would also be better suited to claims filed during the transition, when AVs share the road with conventional vehicles, the report argued.
The report makes several recommendations for AV liability systems, including providing full and timely compensation, efficient claim resolution and encouraging the AV industry to focus on safety, as the insurance industry does today.
