It has become common in recent years that we talk about driverless cars. Excitement about a future scenario with self-driving cars on the roads has grown, which led multiple companies including tech giants like Google (with Waymo), Uber, and Tesla to start testing their own autonomous vehicles on American roads.

It is foreseen that AVs will be at least as good as human-driven cars. If human-driven cars need car insurance, why would it be different for self-driving cars? AVs will not be able to go about without insurance, but insurers will need to introduce some changes in their policies.

Even though self-driving vehicles aim to eliminate human driver errors, fully autonomous cars are not exempt from provoking accidents. Self-driving technology and its public integration came under the fire in May 2016 when a Tesla driver crashed into an articulated truck. Almost two years later, in March 2018, Uber Technologies stopped AV testing after one of its cars hit and killed a woman in Arizona. Waymo’s monthly reports have informed that its vehicles have been in two dozen crashes.

Insurance premiums are based on a driver’s likelihood of being involved in an accident. As more than 90 % of accidents are caused by human errors, if there is no driver, insurers will have to make some changes as regards liability because, with fully autonomous vehicles, the driver won’t be the risky part. Who will then be rendered liable for any damage?

Liability will probably be transferred from the individual to the manufacturer and the licensers of the software that drives the AV. In this new landscape, car insurers will start covering automated driving modes. Insurers will continue to pay out for claims, but they might be able to recover some costs from carmakers when it is their technology what caused an accident.

It is true that are currently no self-driving cars on South African roads, but the government has plans for their introduction. Without regulation regarding the operation of self-driving vehicles, South Africa’s stance on AVs is quite unclear.

In any case, car insurers in South Africa will need to revise their policies as regards automated driving modes, as South Africa has started to see public autonomous vehicle trials since 2018.

Despite the accidents that may be caused by self-driving technology, advancements in driverless technology are progressing every day. Automated cars are currently being tested and perfected. This evolution of AVs is bound to redefine the risk profile for the car, which entails unavoidable adjustments in car insurance policies.

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