What can we learn from insuring autonomous vehicles?

11th April 2017

Government has introduced the first legislation specifically targeted at facilitating the introduction of autonomous vehicle (AV) technology on our roads. The Vehicle Transport and Aviation Bill (the VTA Bill) (previously trailed as the Modern Transport Bill) was introduced by the Government on 22 February and plugs a potential gap in insurance coverage when a vehicle is operating in autonomous mode

The Bill sets out the Government's preferred "single insurer" model, under which drivers will buy a policy which is activated by an incident for which they are responsible (as human driver) or for which the vehicle is responsible (whilst driving in autonomous mode). There are restrictions on when insurers will be liable to the driver whom they are insuring, including where the software has not been upgraded or has been the subject of an unauthorised upgrade. The intent of the provisions is to ensure speedy and efficient recourse is available to third parties involved in an incident with an AV, with insurers and Original Equipment Manufacturers (OEMs) determining liability for product liability issues behind the scenes. 


We recently co-hosted an event in Bristol with the British Insurance Law Association’s Under-35 group and were pleased to welcome David Williams, Technical Director from AXA UK. David has been leading the Association of British Insurer’s working group on autonomous vehicles and is closely involved in discussions with the Government around unlocking the legislative barriers to deploying autonomous vehicle technology on our roads. At the event he discussed his thoughts on insuring connected and autonomous vehicles and also on the VTA Bill. David welcomed the VTA Bill as a big step in moving regulation forward and described the Bill as a “great solution which protects the road users”. 


David also highlighted that legislating for insurance will not, in itself, be enough to support the adoption of connected and autonomous vehicles and that the VTA Bill is one of many legislative proposals needed for the success of AV technology. In its response to the consultation on insurance and regulatory reform launched by The Centre for Connected and Autonomous Vehicles (CCAV) in July 2016, the Government concluded that a rolling programme of regulatory reform is needed to ensure the appropriate legal frameworks are in place to support the introduction of autonomous vehicle technology. 


There are several key areas where further legislative change is necessary. One of these is data sharing which is crucial to enable insurers and OEMs to allocate liability. Insurers will only be able to support insurance models for autonomous vehicles if the right data sets are made available to them, and similarly allocation of liability between other stakeholders will only be made possible with appropriate data exchanges to enable accidents to be investigated and proper allocation of liability to be determined.


Authored by: Lucy Pegler, Burges Salmon

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