Insurers and automakers puzzle over risks of self-driving cars

Insurers and automakers puzzle over risks of self-driving cars

Insurers and automakers puzzle over risks of self-driving cars With autonomous cars set to conquer the market, the question remains: who is liable during crashes?

Tesla chief executive Elon Musk said the company will not be liable if the car is involved in a crash while in self-driving mode.

A spokeswoman for the company confirmed that Musk said insurance companies will have to pay for the damage should the cars be involved in accidents.

“I think one should view autonomous cars much like an elevator in a building. Does Otis take responsibility for all of the elevators around the world? No they don’t,” she emphasized.

Volvo has a different stand, however, after announcing last year that it will assume liability for any of its cars while they are engaged in autonomous mode.

It is not just the auto industry that is concerned about the new cars. Car insurance companies are also at a loss to determine the risks involved in this emerging technology.

“I don’t think auto insurers will know the risk until they see the types of claims that will come in,” explained Michael Barry, vice president of media relations for the Insurance Information Institute.

The clock is ticking on this issue, as self-driving cars are expected to descend on the market en-masse by 2018 to 2019, according to auditing firm KPMG.

Despite these dilemmas, car insurance premiums are expected to go down by 40% by 2050, when autonomous cars become ubiquitous, insurance firm Aon said. Still, the decline will still depend on accident rates for driverless cars, as compared with conventional vehicles.
 

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