Self-Driving Cars and Your Auto Insurance

Toronto, ON (May 30, 2014) – When autonomous vehicles such as the self-driving Google Car begin to arrive in meaningful numbers, they will change many aspects of life and society as we know them today, from jobs to public transit, auto ownership to commuting, and much more. But what do they mean for your auto insurance?

Assuming self-drive cars are truly autonomous enough to live up to their names – Google’s test fleet vehicles have driven more than a million kilometers without an accident – then travelling on public roads from one point to another ought to become much safer.

Most of us have the sense that our roads are already relatively safe today. That said, they are not really safe! In Canada, there are still almost 2,000 deaths each year – more than five per day. The total rises to about 35,000 across North America.

Since the Sixties, when Ralph Nader and others began pushing for improvements, driving has become steadily safer by most measures. Statistics show that the number of deaths, serious injuries, injuries in general, and accidents have all been decreasing. For example, Transport Canada data show that traffic fatalities decreased from 3,073 to 1,834 between 1992 and 2011 – a dramatic improvement.(1)

The safety improvements over the last half century have come from three major areas: better roads, better drivers and better cars. That said, it has been shown that up to 90% and more of accidents result from driver error.

I am sure we all have been guilty of letting our minds wander while driving, or of being distracted by something inside or outside the car. It is difficult to imagine an ordinary commuter remaining perfectly focused, without a single lapse, for a one-hour drive, a common commute time.

If the dawn of autonomous vehicles significantly reduces the number of accidents, then auto claims will dwindle as well, driving down the cost of auto insurance.

In today’s auto insurance environment, the driver controls the vehicle and is responsible for it. In the case of an accident, a driver is then responsible for injuries or damages, including those of other parties, to the degree that the driver is at fault.

If no one in the car is driving it, then presumably the responsibility will shift to whatever is in control of the vehicle. If that driving device came as part of the vehicle, then presumably the responsibility for damage moves to the manufacturer of the controlling devices.

If you own the car, then you would still have some insurance responsibilities that are not linked to driving, such as vandalism, theft etc. However a trend towards ride and car sharing gives some validity to the possibility that many people will choose to not own an SDC, but to call one when needed – like a taxi but without the driver.

Those who are looking forward to a future with a sizeable share of SDCs have described a wide variety of potential benefits from their widespread adoption – topics for future articles.

SDCs may well be arriving at least in small numbers in our communities by the end of the decade. Almost certainly they will have a significant impact in the following decade. We can watch and hope for the reduction or even elimination of our monthly or annual auto insurance bill in that timeframe.

All car manufacturers have ongoing R&D programs to provide improved driver assist features and further improve safety. Most also are working towards fully autonomous vehicles.

The Google car in particular has caught the spotlight since the company’s May 2014 announcement of their prototype, a car without a steering wheel, a brake pedal or a gas pedal.(2) Tech news and analysis site Re/code has published a Q&A with Chris Urmson, head of Google’s self-driving car project, with more details.

By Doug Grant, CIP


1. Transport Canada, 2011 Canadian Motor Vehicle Collision Statistics Report (PDF)

2. The Guardian, Google’s self-driving car: How does it work and when can we drive one? 29 May 2014