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News & Knowledge

UK signals green light for driverless cars

10th March 2017
Myerson

It is not long ago that the idea of driverless cars was confined to visions of the future portrayed in film and TV. However, driverless technology is fast becoming a reality, with companies like Google and Tesla taking the lead and many vehicles now commonly utilising features which make decisions for the driver such as cruise control, ABS and self-parking. MSI's Northern UK law member Myerson explains further.

The technology offers many benefits to people who are leading ever increasingly busy lifestyles. Commuters may be able to check their e-mails, read a book or engage in a telephone call during their journey. However, despite the fact that the technology promises to improve road safety by reducing the risks associated with human error (which are responsible for more than 90% of current road fatalities), it remains to be seen how quickly people will adapt and place trust in the technology.

The UK Government has been vocal in attempting to establish the UK at the forefront of the development of driverless technology. The Government has previously suggested that driverless cars will be on the roads in the UK as early as 2020, to coincide with the proposed releases of fully automated vehicles by certain manufacturers, including the Googlecar.

However, there are still many question marks around certain issues which a change of this magnitude will inevitably bring with it. Many commentators are questioning whether the lawmakers, businesses and insurers are moving at quite the same fast pace as those developing the technology.

Product Liability

Consumer law imposes strict liability for injury or damage where the product is found to be defective, i.e. where its safety is not at the standard which the consumer is “generally entitled to expect”.

Whilst manufacturers may seek argue that consumers are not entitled to expect that driverless cars will be completely free from risk, recent Government reports have expressed that consumers are only likely to assume liability themselves where they have chosen to resume manual control of the vehicle, meaning that in many cases the burden of the risk is likely to remain with the manufacturer.

There have been a number of proposals suggested to address some of these liability concerns. For example, it has been suggested that driverless vehicles should include software as standard which is capable of reconstructing each road traffic accident, in order to assist in determining liability.

However, at the time of writing, the issue of liability remains shrouded in uncertainty. It is expected that the Government will conduct a review of existing product liability legislation with a view to proposing changes to clarify the liability situation by the end of Summer 2017.

Insurance

A group of insurance companies, led by the Association of British Insurers, has been formed to consider the key questions surrounding insurance and liability. The passing of risk between insurance companies and manufacturers is likely to be a key question which the Government need to determine before driverless technology becomes mainstream.

One insurance company in the UK already offers insurance for driverless vehicles and others are expected to follow. It is expected that driverless technology insurance policies will potentially include cover for risks such as failure to install software updates, satellite failure, failure of the operating system or if the car gets hacked.

Cyber Security

Myerson previously reported on the growing threat of cyber security to businesses. The risks of hackers interfering with the driverless software could have obvious catastrophic consequences.

Manufacturers and businesses will therefore be keen to ensure that the technology is backed up by high level security. Whilst insurance cover may make references to security breach as an insured loss, the insurer may attempt to pursue the manufacturer to recover its own losses (especially where the breach is deemed to be a result of poor security standards).

Conclusions

There are still many issues surrounding driverless technology which are yet to be resolved. However, it is clear that the Government, together with other businesses in the key sectors in the automotive industry, are keen to address these issues in order to keep up with the momentum of the advances in driverless technology which are being made.

If you have any questions about product liability, insurance or cyber security, please contact Myerson’s Corporate Commercial team

About Myerson - Manchester

Myerson was founded in Manchester, Cheshire over 30 years ago and is a leading, full service commercial and private client law firm providing bespoke legal advice to businesses and affluent individuals across Manchester, Cheshire, the UK and beyond.

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