Blog: Insurance for autonomous cars - from concept to reality

And yet, more than a decade later, we still don't really know when the public will be able to buy one for themselves.

No wonder the public doesn't know what to think about automated driving. A recent survey from Lexis Nexis showed only half of the public think driverless cars are a good idea. A minority (14%) don't think there will be any benefits whatsoever.

Yet, for the government, this is a strategic priority. Even if only half the public are interested in the early days, that still represents a significant opportunity and a boost to the economy.

The Centre for Connected and Autonomous Vehicles was created in 2015, a joint unit pulling together officials from across government. Its aim is to make the UK a world leader in automated driving technology, and ensure that the UK's legal and regulatory framework is fit for purpose as soon as automated cars are ready for sale.

That's why the latest stage of the government's rolling programme of regulatory reviews focuses on setting out how insurance will work for the first truly ‘automated' driving technologies, which many predict will start coming onto the roads from 2021.

According to Lexis Nexis, only 26% of consumers expect the existing insurance model to survive when automated driving arrives. It makes sense, therefore, for insurers to work with the government to make sure consumers continue to understand the risks of the road and take out the right cover.

But you should not expect the government to re-write the whole Road Traffic Act. After all, the automated mode will initially only be included in a small number of top-end vehicles and, even then, only used in the safest driving situations.

So, CCAV plans to adapt the existing motor insurance system so that, when automated modes are enabled, motor insurance also covers this. It then hopes insurers and motor manufacturers will establish a system for the costs of these claims to be apportioned fairly.

But, while there are clear advantages to a modest reform that sets things in motion, this does put the onus on insurers. Although the long-term vision might be a seamless network of connected technologies, the reality is likely to be a somewhat messier as different technologies serving different needs compete for the public's attention.

Insurance will be crucial to managing risks as it is clear not every driver will be moving along the ‘pathway to driverless cars' at the same speed.

There are questions for the industry to grapple with, such as will insurers rely on the courts to recover their costs from manufacturers or will the two industries collaborate directly?

Will responsibility for ensuring the correct insurance cover is in place fall on individuals or on the manufacturers selling the cars? How will insurers respond if it becomes clear that certain models of automated driving have a worse safety performance than others? Will an after-market develop for these vehicles and who will be responsible for ensuring technology and software is up-to-date?

An initial framework for automated driving insurance will be law by summer 2017. That may seem soon, given how much longer we will have to wait for the cars themselves, but it is only the first part of a much longer conversation, forming a key part of the agenda at the Association of British Insurers's Motor Conference.