Do automated cars pose less of an insurance risk than people?

White modern car, parked.
Photo by Dylan Scarsone Apexpixel on Unsplash.

News this week of a new automated car study in Queensland got us wondering how self-driving cars might affect insurance?

The study which is being conducted by Queensland University of Technology researchers will see 60 Aussie motorists test drive the automated car 'ZOE2.'

A joint venture between the Department of Transport and Main Roads, QUT and iMOVE Australia, the findings are intended to prepare the country for the arrival of 'Cooperative and Automated Vehicles' (CAVs).

Our question is, what will car insurance look like for these new automated cars?

Who is liable for automated cars?

One of the biggest questions surrounding automated cars and insurance is who is liable? Is it the person behind the wheel or the manufacturer who programmed the vehicle to drive?

According to tech news site VentureBeat, Google, Volvo and Mercedes-Benz are all already prepared to accept liability, where an automated vehicle's system is found to be at-fault for an accident. Why? Most likely because they are pretty confident in the technology, more confident perhaps than in people.

Human error is after all a big factor in a lot of car crashes. In fact, according to the US Department of Transportation, as many as 94% of crashes can be attributed to mistakes made by people.

In a 2016 article in The Conversation, PHD Candidate in Motor Insurance Law Matthew Channon speculates that in the future makers of self-driving cars will be required to take out insurance to cover liability for potential accidents.

Will car insurance premiums be cheaper?

Although the history of the fully autonomous car goes back as far as the 1980s, we're still a long way away from this technology making it into the mainstream. That said, an article on Auto Insurance Specialists predicts that insurance premiums may actually go down. This is because in a self-driving car, factors such as age and driving experience may no longer be taken into account.

Although the theft-rate in your area will probably still have some bearing on what you pay. On top of this, Channon predicts that manufacturers will put the cost of their own liability insurance back onto the consumer, by way of higher purchase prices.

Will car accidents become less common?

In its report 'Self-Driving cars: The next revolution,' KPMG explores the idea of inventing 'crashless vehicles.' The report quotes the then Associate Administrator of the US National Highway Traffic Safety Administration (NHTSA) saying that the aim is not simply to make self-driving cars as safe as human drivers, but to ultimately make them safer. The report was done in 2012. More recently in 2017, Professor Hussein Dia from Swinburne University of Technology said that taking humans out of the "driving equation" would save lives.

Since the dawn of their invention, manufacturers have been striving to make cars safer. From the introduction of seatbelts to more and more automation, including ADAS (advanced driver assistance systems). It only follows that a completely automated car with no room for human error is the next logical step.

We're excited to see what happens next in Australia. In the meantime, we all still have to drive our cars and as such we all still have to have the right level of car insurance. If you're looking for cover for your wheels, head to Mozo's compare car insurance page to have a look at comprehensive policies on offer right now.

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