Unlikely. Car owners will still need liability insurance, lenders will require comprehensive, collision, and uninsured motorist coverage to protect their collateral. These coverages should in theory get less expensive if claims drop, but profit margin on the policies doesn't necessarily change.
Legal liability will shift to the manufacturers, therefore individuals will not require insurance. Insurance policies will be purchased by the manufacturers and will cover the entire fleet under one policy.
> coverages should in theory get less expensive if claims drop
This is certainly the largest factor, as insured losses are expected to drop by 90%. A secondary factor will be that car manufacturers will be able to negotiate wholesale “group policies” on large fleets and get a better rate. Or they could self-insure and cut out the insurance industry completely.
> but profit margin on policies doesn’t necessarily change
I have already noted the profit margin pressure arising due to wholesale fleet insurance / self-insurance. But the more important point is that profit margin is not the only relevant measure for an industry. The total amount of revenue is equally important. If profit margins stay the same but revenues decrease, then there is a reduction in net income. Note that prices are expected to fall 90%, which directly impacts revenue.
No, it probably won't. Owners will probably remain liable in the first instance, for maintaining th vehicle in a safe operating condition; manufacturers (and the whole chain of commerce) will be liable, as they are now, for defects that exist at the time of sale, and will be (as they are now) attractive deep-pockets defendants.
But, for that reason, they will probably get very good at playing off failures (since drivers aren't in the picture to blame) as maintenance failures rather manufacturing defects.
The concept of "Owners" is an interesting one in the context of self-driving, manufacturer-insured vehicles. I'd imagine that self-diagnostics would have to get very very good to the point of not starting when a single sensor is unavailable - nobody would want to ride in "their" car if it has a chance of causing a crash and them being legally liable despite not driving it.
But, for that reason, they will probably get very good at playing off failures (since drivers aren't in the picture to blame) as maintenance failures rather manufacturing defects.
Manufacturers already do that now...Ford was doing that back in the Pinto days.
The change to self-driving cars will make maintenance (and maintenance records) more important for drivers for liability purposes, but will also make it more difficult for the manufacturers to avoid liability.
I was recently wondering why new cars don't come with factory fitted dashcams. Perhaps a law should mandate their inclusion, along with other data logging mechanisms.
Tesla does. Stick a usb stick in my model 3 and it uses the storage to record off the cameras. They just added a mode to record video when the car is “threatened” while parked.
No, it probably will. In the same way that you are not liabile for any accidents if you are a passenger in a taxi. It will take some time for legal scholars to work out all the details (e.g. gross negligence, etc), but it is very obvious that passengers in fully autonomous vehicles cannot be legally liable to the same extent that drivers are liable today.
> In the same way that you are not liabile for any accidents if you are a passenger in a taxi.
A passenger is neither an owner, an operator, nor a manufacturer of a taxi.
Owners, operators, and manufacturers tend to be liable; passengers not under normal circumstances. If I get hit by a bus (to escape the taxi situation where the operator is usually the owner), the bus driver, bus line, and bus manufacturer can all be liable. Replacing the operator with a piece of equipment manufactured by the manufacturer and maintained by the owner takes the driver out of the equation, but there is no logical reason why it would remove liability from the owner.
It's basic product liability law. The liability is actually on both the owner and the manufacturer (and the dealer, and anyone else involved in that chain of transactions...). And as the deeper pocket, realistically the liability is all on the manufacturer.
I thought we were talking about your own vehicles. If you own a self driving vehicle, and it crashes because you neglected maintenance then that's on the owner not manufacturer, just like it is with existing cars.
Sure, but what if I had done all the maintenance I was supposed to and it crashes. Should that still be on me or on Waymo?
I wonder self driving car manufacturers are going to try to get around this making the required maintenance and 'pre-flight' check list so onerous that basically nobody is completely in compliance and thus they're never responsible.
Yes, if you drive around and suddenly your spring coil breaks making you swerve and hit someone else, that's still on you, even if you have followed the maintenance booklet precisely. You can't sue the manufacturer for that, they will just say the part has worn out and you were supposed to spot that(somehow, even though the law requires an annual inspection at best).
if you drive around and suddenly your spring coil breaks making you swerve and hit someone else, that's still on you
Yes, but is it on me, the drive, or me, the car owner? Or if someone else is driving my car who's fault is it then? In the self driving scenario couldn't you make the argument that while it's my car, I'm only the passenger and Waymo is in fact the driver.
But you are the owner of the vehicle, right? Then you are responsible for its technical state, even if someone else, be it a person or a machine, is driving.
Like.....if you let your friend drive, and the tyre bursts and you end up hitting another car for example - no one will be at fault(most likely), but your insurance will still end up paying for it. I don't see why it would be any different with AI driving the car, in essence it simply doesn't matter. An object belonging to you has damaged an object belonging to someone else - therefore your insurance has to pay for it.
Then I won't own the vehicle, I'll rent it and leave the maintenance up to the rental company.
Who would pay to own a car that sits around parked >90% of the time anyway? A rental company could have that car out making deliveries and ride share pickups until it's time to pick me up at the end of the work day.
Then sure, absolutely, but there will always be people who will want to own the car not rent it for a plethora of different reasons that perhaps do not apply to you. And the argument here is that those people who chose to own self-driving cars will still have to insure them - the fact that the car drives itself doesn't change the fact that you could be liable for any damages that happen when it's on the road.
And as an aside - how is this different than a taxi then, at that point? If that model already works for you, then uber fills that niche already. Unless there is some assumption that somehow it would end up being cheaper than uber? I can bet it would be cheaper for me to take ubers to work than own my car, and yet I'd prefer to have my own person vehicle and not deal with shared vehicles.
Uber doesn't fill that niche. I'm talking about a long-term rental whereby the car is guaranteed to be available to me during specific time windows. Uber is only for one-off trips, not a long-term replacement for my commuter car.
I feel like that's a distinction without a difference. If I call an uber, it will arrive in 5 minutes max and take me to where I need to go. I can call one in the morning to go to work, and another one after work to get home. It could 100% replace my commuter car that I have right now.
Because I like having my personal car, where I hop in and the seats, temperature and music are set to what I like, there's no weird smells and I have privacy and comfort. Besides, I think that about 60% of taxi drivers should never be in charge of any motor vehicle and are completely incompetent at driving, I don't feel safe at all. But that's beside the point and will be fixed by autonomous cars. But being in a vehicle shared by others will not, and I have no interest in doing that, just like I have no interest in taking a bus.
But yes, I have just done the calculation and it would in fact be cheaper for me to uber to work than to own my car. Yet I still prefer to have my own car that yes, does absolutely nothing for 95% of the month.
I still think fully autonomous cars would let you have your cake and eat it too. Maybe you don't want smelly passengers in your car or to have it unavailable at certain times of the day or week. That could be done. Maybe the rental car is available to you during the day but moonlights as a driver for Amazon packages?
It could all be spelled out in a service level agreement.
Nah.. Manufacturers will even invest heavily in lobby efforts for this to never happen. Even if consumers will likely not own the car as they currently do (see the growing trend that you're not actually owning the car but you're paying for the license to use it indefinitely) they will be responsible for keeping it running will be the de-facto 'operators' regardless if the car is driving itself. The car will probably not store itself, not maintain/clean itself, will not keep it's radars/cameras active and not blocked by dirt/snow/etc.. Call me a pessimist but the consumers will likely get shafted.
This is a battle they lost decades ago. Product liability laws have been on our books for more than a century, and the general gist is that everyone from the owner to the manufacturer is jointly and severally liable to various degrees depending on the circumstances of the failure.
A failure to do poor maintenance shifts the liability almost entirely to the owner, but a defect puts liability almost entirely on the manufacturer. (But note: "jointly and severally liable" means that they're all on the hook with respect to the plaintiff's award. The assignment of liability is how the plaintiffs ultimately settle the bill amongst themselves.)
> This is a battle they lost decades ago. Product liability laws have been on our books for more than a century, and the general gist is that everyone from the owner to the manufacturer is jointly and severally liable to various degrees depending on the circumstances of the failure.
If the battle was lost, where's Tesla wrt to the deaths caused by autopilot? Or was the manufacturer's disclaimer enough to blame the dead operators?
> Call me a pessimist but the consumers will likely get shafted.
You're a pessimist!
Actually I don't see that there would be much difference. The car will perform at some level of skill and have an associated risk, lets say that amounts to $50/mo. The customer could pay the manufacturer to pay the insurance company, or the customer could pay directly -- same thing?
The end game is that almost no one will own a car, and most people will use fully autonomous taxis for transportation. If and when fully autonomous vehicles become a reality, auto insurance will die along with car ownership and parking lots.
I see little reason to suppose that that will be the end game. Those for whom the total cost of ownership of a car are lower than the cost of taxis will continue to own a car.
What fraction of people that currently own cars will that be? Probably depends on where you live. Taxi will probably never be the popular choice in, say, South Dakota. The economics just don't work out.
The cost of autonomous cars, especially in terms of maintenance, is likely to be higher. And autonomous taxis will be cheaper to operate because drivers are a very expensive part of them. The number of people for whom owning a car makes sense will definitely go down when prices on cars rise and prices on taxis and public transportation drop.
This is ignoring the fact that having an unproductive self driving car sitting in your garage becomes a significant opportunity cost itself.
Shared autonomous cars would end up being treated even worse than rental cars. People would smoke in them, vomit in them, damage the upholstery, steal the radios, let their pets go to the bathroom, spill all kinds of stuff in them on the way home from Home Depot, and so forth.
Anyone who can afford it and has a place to park it will want to have their own self-driving car to avoid having to put up with the shared ones.
Ownership will also be more convenient, e.g. you can leave your stuff in your car when you park it. Your car is reserved for you to use whenever you want, so you don't need to wait for a shared car to become available.
Stick a video camera inside the car. If an ML algorithm detects anything too far outside of the norm, send the video to a human. If the human notices damage, the riders are banned from the system. Banned rider lists could be shared between autonomous taxi providers. End result: no one will fuck with the cars.
Except that we are humans not robots. You never picked up a friend after a night out who got sick in your car? Or had a baby that decided to smear poop all over the seats? Spilled coffee in the car? Know someone who likes to smoke in the car? That stuff happens, and if there was even a slight risk that it would get you banned from convenient transportation then yeah, people will buy their own so they don't need to worry about this. Pretty much everyone who has kids has to keep extra stuff in the car just in case - ergo, they will always go with personal vehicles. Otherwise, we'd see far more people switching to taxis than driving their own cars, especially compared to new cars, as monthly taxi cost can easily be lower than car/insurance/tax/fuel payments on a new vehicle, and yet people keep buying them.
It would be very simple for manufacturers of autonomous cars to obviate the question of "who is liable" for a collision by simply loading insurance into the price of the vehicle.
Extremely easy to price into a lease; less obvious but still eminently feasible with a sale.
I am going to go with, not until they get all non self driving cars off the road. Until then during the transition it will become a lawsuit paradise until the regulations are settled as any crash involving a self driving car with a person driven car will be challenged with boasts of class action suits and more.
a large portion of my current insurance is for uninsured motorist and under insured though my agent says the former is by far the biggest issue. considering law enforcement isn't making much head way there and true self driving isn't going to happen soon except under theme park ride conditions I don't think insurance is going anywhere.
