Insights

Are autonomous vehicles more safe or less safe than human drivers?

Many people equate risk with negative outcomes, however one can liken it to calling a play in football. Coaches make calculated risks based on data – and tolerating certain risks can lead to big wins.

In the insurance world, when it comes to calculating risk, factors such as industry, annual revenue and past claims can affect the risk rating for insurance. Insurance markets have many years of past data to help understand and quantify these risks.

The challenge with autonomous vehicles, is that performance data is still being developed. Despite claims to the contrary, self-driving cars currently have a higher rate of accidents than human-driven cars, but the injuries are less severe. On average, there are 9.1 self-driving car accidents per million miles driven, while the same rate is 4.1 crashes per million miles for regular vehicles. What is more certain is that we should expect to see insurance premiums start to come down as autonomous vehicles become more widely used and more data that is collected.

Who’s to blame in an accident involving an autonomous vehicle?

The concept of vicarious liability may apply to these cases, meaning that there could be multiple parties held to account. In hospitals a malpractice suit may name the hospital, the equipment manufacturer and the physician. As AI and big data take up more space in medical decision-making, doctors are cautioned not to overly rely on these technologies as such dependence could lead to dangerous errors. Similarly, balance between human beings and autonomous vehicles is needed to counteract the potential for mistakes on either side. Still, there are likely to be multiple parties held responsible when things go wrong.

What about data privacy concerns?

As autonomous vehicles gain further traction, the data collected will trigger a tug of war between consumers and vehicle manufacturers, says Les. Again, there are lessons In the healthcare space, where your health related data (stripped of personal identifiers) can be used, without explicit permission, to advance medical science. A case could be made that consumer data from autonomous vehicles should be used in a similar fashion, without permission, to address safety issues. Like other Big Tech issues, navigating regulatory concerns should be the job of federal governments. Even in places with strict data privacy laws in place, such as GDPR in the EU, the regulatory bodies my see fit to create exceptions regarding autonomous car data usage for the purposes of greater safety.

How comfortable are you with wireless vehicle software updates?

With the world of connected devices growing to 25 billion by 2030, there are massive exposures for both cyber attacks and critical software system failures. Not only that, but a software bug that is automatically uploaded could prove catastrophic.

In a threat landscape where hackers are relentlessly keeping pace with every new cybersecurity development, civilian infrastructure targets are at particularly high risk. Rather than over-the-air updates, a safer solution for passenger vehicles would be to have software updated as a routine maintenance service, where these service stations can be maintained at the highest levels of cybersecurity.

While e-bikes and scooters are great for sustainability, how risky are they?

E-bikes and scooters may be a market threat for electric cars as they help people navigate urban areas efficiently – and cities are embracing the sustainability trend with bike lanes and traffic calming measures – but the lack of safety regulations and equipment (like helmets) creates significant personal risk.

Federal regulation could create uniformity across state lines, with speed and safety enforcement by officers or even by unmanned sensors. Additionally, to control insurance costs, taxes levied on companies and users could contribute to an accident fund to help injured parties, using a model similar to the “wildfire fund” being implemented in California.

We have to talk about cyber. How important is cybersecurity awareness?

Frankly, while Risk Cooperative works across the full spectrum of risk, cyber risk is 110% of our mindshare. The proliferation of cyber threats from ransomware to deep fakes means that cyber insurance coverage has become important for all clients, regardless of contract requirements or business size. Our job as risk experts is to make clients aware of cyber risk as well as the insurance solutions available to mitigate that risk.

Any final tips for organizations, product designers, and individuals?

“Company leaders need to know that cybersecurity is no longer just an IT imperative, it’s a business imperative. Understand that your CISO is an instrumental part of your business resiliency,” says Les, “and your board needs at least one seat reserved for someone with cybersecurity experience.”

When creating new connected products, designers need to assume their products will be hacked. With that in mind, they need to make clear recommendations for good cyber hygiene protocols that consumers can put in place to protect themselves.

For individuals, data backups are critical in the event that your cloud storage is compromised; one easy step toward greater cybersecurity is to make sure your important data is backed up frequently an external drive.