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Manufacturers, insurers may clash over autonomous car liability

Two areas of the law often impacted by automobile accidents are insurance coverage and products liability. Traditionally insurance is supposed to cover driver errors, while products liability covers manufacturer and design problems. But the future of the law concerning car accidents may turn that equation on its head.

Driverless vehicles are here. While not yet prevalent on the public highways, autonomous or self-driving cars are being tested on the roads and both manufacturers and insurers are monitoring accidents and other incidents involving the vehicles. The question is: when a self-driving vehicle is involved in an accident, is it the fault of the human occupying the vehicle or the fault of the technology?

The president of Volvo recently said that his company will accept full liability when one of its cars is in self-driving mode. Those losses would likely be covered by the manufacturer's products liability coverage as opposed to the occupant's insurance. With the vehicle making more of the decisions for the human driver, someone injured while the car is in autonomous mode may not be able to sue the driver under his or her insurance coverage.

Insurance companies are starting to look to the future of autonomous vehicles and how they will affect the insurance industry. In 2014, just in Ohio, about $5.7 billion auto-insurance premiums were collected. According to some research, driver error causes 94 percent of vehicle accidents. So the insurance industry will have to change with the technology.

Of course, sometimes the fault will not fall on either the manufacturer or the vehicle's occupant. Some examples have already been recorded of hackers breaking into an autonomous vehicle's computer system and hijacking the vehicle, leaving the occupant and the self-driving device helpless to control it. Perhaps this could be considered a products liability defect if the manufacturer did not make the vehicle safe from such hacking, allowing it to become a dangerous product.

Anytime new technology enters the marketplace, society as a whole must learn to adjust. Hardly anyone can live without some form of computer today when only a couple of decades ago hardly anyone had a laptop. As part of society, the legal system must adjust as well. As automotive technology develops, those who are involved in an accident with an autonomous vehicle will have to rely on the knowledge of attorneys who must stay up-to-date on these legal developments.

Source: Insurance Business, "Can self-driving car makers handle depth of liability?," Oct. 29, 2015

Secondary Source: Columbus Dispatch, "Could driverless cars wreck the insurance industry?," Mark Williams, Aug. 6, 2015

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