In recent years, motorists have shared the road with increasingly capable evolutions of self-driving commercial motor vehicles (CMV). At first, “self-driving” meant obstacle detection and collision avoidance. Then, in October of 2016, Uber’s former subsidiary Otto (now Uber ATG) succeeded in delivering 45,000 cans of Budweiser Beer with a 100% on-highway driverless solution.
Technology continues to progress, and manufacturers are striving to create a fully autonomous CMV that may eventually eliminate the need for CDL drivers altogether.
With true driverless technology on the horizon, the entire industry is asking, “How are we going to insure this?”
It might not come as a surprise that there is no clear answer. There are many factors to consider, and uncertainty lingers on what exactly the final product will be. One major issue is the varying degree of autonomy that will likely exist.
Consider this: currently, the driver that a motor carrier places in a truck is one of the key factors that an insurance carrier evaluates. By how much will that factor be reduced if the driver is no longer operating on-highway, or if he or she is a passive observer altogether—only to be used in an emergency?
Whatever the answer is, insurance carriers are no longer focusing on who is driving the vehicle, but what. As the focus shifts to the artificial intelligence powering these vehicles, many believe that liability in the event of an accident will shift as well.
Should a motor carrier be held responsible for an accident that occurs while a CMV is operating autonomously?
While future legislation—and litigation—will likely weigh heavily on this decision, many believe the answer is no. If that’s the case, insurance companies will no longer focus on providing coverage to motor carriers, but to the manufacturers of self-driving CMVs. However, none of the major CMV manufacturers are responsible for the development of the self-driving technology in their vehicles. The software developers and sub-system manufacturers of driverless technology are all potentially liable for accidents, injuries, and fatalities that motor carriers have traditionally had to answer for. Yet, even if the liability of the motor carrier is diminished, it will never go away completely.
How might the underwriting process change with the evolution of driverless technology?
Trucking companies will still need property and casualty insurance, but the underwriting done by insurance carriers will be vastly different. A motor carrier’s hiring practices, driver training, and corrective action procedures all become obsolete when the driver is removed from the equation.
At this point there are still more questions than answers, but self-driving CMVs are already on the road, and the technology continues to evolve at an incredible pace. Through questions and conversation, the industry must evolve along with it.
So consider the conversation started!
Additionally, historical loss experience is no longer useful in forecasting future losses as companies transition into what should be safer driverless technology. Rather than focusing on the individual exposure of each vehicle, underwriters will concentrate on the company as a whole. For example, here are some of the underwriting questions that could come to the fore:
- List all autonomous technologies currently being used in your fleet.
- Provide make, model, and software version for each CMV in your fleet. How often is software updated, and who is responsible for the updates?
- Who is your Chief Technology Officer (CTO)? Provide qualifications and experience with autonomous vehicle technology.
- Describe your “human firewall” best practices (e.g., password protection, cyber security procedures, and training).
Furthermore, cyber liability protection could become the fundamental component of an insurance program for a motor carrier. Statutory limits, similar to those in place for auto policies, may become the norm for cyber coverage as well.
To discuss CMV coverage, contact an Integrated Risk Solutions Account Executive. It’s an exciting time to be in the transportation industry!