Artificial Intelligence

Trolley AI, 2

II. Who will be to blame if the vehicle causes an accident?

            Autonomous vehicles will necessitate the creation of new insurance products, or at the very least, the adapting of existing insurance products. Auto manufacturers will likely insure their own vehicles. If the autonomous software is doing the driving, the manufacturer will have to shoulder the responsibility. The responsibility of the human driver will diminish as AV’s become the preferred method of travel.

            One insurance issue that will arise is when a human assumes manual control over the autonomous software. This would place the liability on the human driver. In the future, the ability for the human rider to take control will likely be removed because of this liability. Additionally, the exponentially increasing capabilities of AV’s will remove the incentive to have human driver capabilities.

            Due to the uncertainties surrounding the AV insurance market, the car manufacturer Tesla has started an insurance arm already. This allows them to self-insure their vehicles, as well as collect premium from their drivers.

            There are benefits to allowing AV’s to become widespread. Laura Hay, a national insurance practice leader with KPMG, says that “autonomous vehicles may reduce traffic fatalities by as much as 90%.” (McDonald, 2013). That article was written in 2013, a time when AV’s were just beginning to be accepted.

Now in 2020, the real reduction may be higher. The National Highway Traffic Safety Association notes that “94% of serious crashes are due to human error.” Furthermore, 36,560 people died in 2018 due to motor vehicle crashes. AV’s could have prevented more than 31,000 deaths in 2018. By removing human driving capability, at least 94% of serious crashes may be prevented in the future. (NHTSA, 2019).

            There are some drawbacks for AV adoption in terms of insurance, but most of these are drawbacks for legacy automotive companies, not for newer AV’s. The insurance market will be smaller for vehicles. There will be less coverage required and less premium collected. This could dramatically impact existing auto insurers and owners. In fact, Hays says that existing auto premiums may decline, but there is a certain point where non-autonomous cars are too expensive to insure based on the risks associated with human drivers. Humans may be forced out of the driver’s seat by the economics of insurance because the pool of drivers seeking insurance may decline enough to make insurance prices unsustainable for the average consumer.  

One interesting situation with AV’s is that many drivers and riders are still wary of using them. Because the technology is still new, many consumers cannot imagine using an AV. The reality is that increasing insurance costs may force consumers to adopt AV’s.


McDonald, C. (2013). Driverless cars: A risky opportunity? Risk Management, 60(9), 6-6,8. Retrieved from

National Highway Traffic Safety Association. “Automated Vehicles for Safety.” Accessed 18 December, 2020.

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