The future of self-driving cars
Self-driving cars are set to become a reality on our roads. A new bill was recently passed in Parliament regarding automated vehicles and new EU regulatory changes are set to come into force in July 2024, designed to ensure vehicle safety. Here, we take a look at the new regulations, the technology and how insurance will be affected.
The new regulations
It's envisaged that self-driving vehicles will improve the lives of millions of people, making transport more convenient and more accessible, and creating an estimated 38,000 new jobs in the UK from a £42 billion industry. With 88% of road collisions citing human error as a contributory factor, it’s believed that self-driving vehicles will help to reduce deaths and injuries from drink driving, speeding and driver tiredness. But before these vehicles are allowed on our roads, they will have to meet or exceed rigorous new safety requirements, set out in law.
On 8th November 2023, new laws regarding the roll-out of self-driving vehicle technology were introduced into Parliament1. The Automated Vehicles Bill delivers one of the most comprehensive legal frameworks of its kind anywhere in the world, positioning the UK as a world leader in the regulation of self-driving technology, with safety at its core. It determines that all self-driving vehicles must undergo robust safety testing before they are permitted to drive on UK roads and that clear legal liability is established.
Transport Secretary, Mark Harper, said: “Our new Bill ensures safety is at the heart of our plans to see self-driving vehicles on our roads, making the UK a great place to develop this technology." Transport Minister, Jesse Norman, said: “Today marks a landmark occasion as we usher in the future of transport aiming at safer, greener and more efficient travel for all.”
At EU level, The General Safety Regulation (GSR), which sets minimum safety standards for motor vehicles and has been in force since July 2022, sets out specific requirements for autonomous vehicles from July 2024, designed to ensure the safe introduction of driverless vehicles.
The technology
Driverless vehicles rely on GPS data, radars, video cameras and powerful onboard computers that can respond instantly to conditions on the road. Advancements in sensor technology, LiDAR and 4D radar imaging are paving the way for a fully autonomous vehicle, allowing data to be gathered in real time and enabling the vehicle to make timely decisions.
Benefits of self-driving cars
- Few accidents as computers can react quicker to hazards than a human being
- Greater freedom and independence for those unable to drive a car themselves
- Reduced emissions as computers drive more economically
- Less congestion, as people share journeys and there are less cars on the road
According to the Society of Automotive Engineers (SAE), there are 6 levels of driving automation:
- Level Zero: manual driving;
- Level 1: cruise control, where drivers can monitor speeds and take action
- Level 2: integrated Advanced Driving Assistant System (ADAS) with radars, HD cameras and imaging systems to control steering and acceleration
- Level 3: conditional automation, where the vehicle can perform most tasks related to driving with human oversight
- Levels 4 & 5: still in the future, where vehicles can drive themselves
How self-driving cars will affect insurance
Automotive insurance is dependent on an assessment of risk, based on driver behaviour, and already, cars with safety features such as automatic emergency braking systems are placed in lower insurance groups.
With a greatly reduced risk of accidents and collisions, self-driving cars look set to revolutionise road safety and completely change the traditional car insurance model. Management consultants, McKinsey2 estimates there could be a 30% decline in insurance premiums by 2024 as accident rates drop as a result of driverless technology.
There could well be a situation where car ownership falls as people choose to use automated cars on demand, in which case, insurance would fall to the manufacturers or vehicle providers.
In terms of emerging risks, accidents could occur as a result of connectivity failures, hacking, computer or electronic malfunction, or human error, which would raise the question of liability. This all points towards the need for a new auto insurance system, reoriented around driverless technology, as the insurance industry embraces the change.
Interim period
The introduction of self-driving cars won’t happen overnight and there will be a period of adjustment when driverless cars share the road with vehicles driven by people. A survey3 undertaken by automotive industry experts at Rerev revealed that 70% of respondents thought self-driving cars would be less safe than human-driven ones, while a survey4 commissioned by InsuretheGap found that only 6% of drivers say they would feel safe travelling in a driverless car.
There may be uncertainty at present, but with new legislation passed regarding the roll-out of driverless cars, autonomous vehicles are very much the future, and car insurance as we know it will change.
To discuss your motor insurance, whether you require renewal or a quotation, or wish to advise us of any changes, talk to TMD today. Call us on 01992 703 000 or email us at insurance@mcdonaghs.co.uk