The Impact of Self-Driving Cars on Auto Insurance Policies
Key Points:
- Ryan Stein from the Insurance Bureau of Canada (IBC) discusses the implications of self-driving cars on today’s auto insurance laws in this episode of the Accenture Insurance Influencers Podcast.
- Current auto insurance policies are based on the assumption that humans are responsible for 90 percent of vehicle accidents and are not equipped to handle self-driving cars.
- The arrival of self-driving cars challenges existing auto insurance laws, requiring insurers to redefine auto insurance proactively.
Introducing the Accenture Insurance Influencers podcast
The Insurance Influencers podcast from Accenture aims to address the evolving landscape of the insurance industry. Season one focuses on answering key questions such as the impact of artificial intelligence on insurance, effective innovation for insurers, and technology’s role in fraud detection.
Discussion with Ryan Stein on Self-Driving Cars and Insurance
Ryan Stein, the executive director of auto insurance policy and innovation at IBC, addresses the challenges posed by self-driving cars in the insurance industry. The conversation delves into a two-part framework proposed by IBC to update insurance laws and principles to accommodate the emergence of self-driving cars.
This transcript has been edited for length and clarity.
Role of Insurance Bureau of Canada (IBC) in the Insurance Industry
IBC serves as the national trade association for Canada’s property and casualty insurance companies. Its primary focus is on examining the political and regulatory environment to identify opportunities for improving insurance laws and regulations for the benefit of customers.
Levels of Driving Automation and their Implications
Outlined by the Society of Automotive Engineers, the six levels of vehicle autonomy highlight the shift from complete driver control to full self-driving capabilities.
Challenges to Current Auto Insurance Assumptions
Current auto insurance laws are based on the assumption that human error is the primary cause of collisions, with over 90 percent of collisions attributed to human responsibility. This poses a significant challenge when dealing with automated vehicles.
Impact of the Sharing Economy on Auto Insurance
The rise of the sharing economy and ride-sharing services blurred the distinction between personal and commercial vehicle use, prompting the need for legislative and regulatory changes to accommodate new business models.
Implications for Insurance with Automated Vehicles
The transition from personal auto policies to product liability poses complex challenges, particularly in determining fault and compensation in the event of an accident involving an automated vehicle.
Need for Updated Insurance Laws
Automated vehicles challenge the existing auto insurance laws, emphasizing the need to update laws to ensure fair and timely compensation for individuals injured in accidents involving automated vehicles.
Summary
In this episode, key topics included:
- The six levels of driving automation and their implications
- The challenges posed by the sharing economy and their impact on auto insurance
- The need for updated insurance laws to address the arrival of self-driving cars
For more information on self-driving cars and insurance, stay tuned for the next episode, where Ryan will share insights into a two-part framework developed by IBC for automated vehicles and the challenges and opportunities they present for insurers.
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