Engineers are hard at work right now producing driverless experiences, namely cars that do not need assistance from the driver. The automobile or sport utility vehicle (SUV) you drive may already be equipped with components that will be standard on autonomous cars in the foreseeable future. Testing and deployment are now being carried out in several states, including Arizona, Florida, New York, Ohio, and California. However, autonomous vehicles are not yet at a point where they can be purchased by every customer who wants one.

Various Degrees of Automation

• Level 1 mostly depends on the driver, although it may provide warnings or some automated help, such as adaptive cruise control. Level 2 is the first level that provides full autonomy to the vehicle.
• The vehicle's speed and brakes are both under the direction of various advanced driver-assistance systems (ADAS) while operating at a Level 2 level of automation.
• From level 3 through level 5, you will have more control over the car's braking, steering, and route selection. Numerous businesses are already working on autonomous vehicles with a level 3 or higher capability. The National Highway Traffic Safety Administration, however, adds that we are "several years" away from a market that would allow members of the general public to buy completely autonomous cars.

The Path That Leads to Advancement

Karlyn D. Stanley, a senior policy analyst at the RAND Corporation who researches self-driving vehicles, anticipated proceeding at a leisurely pace. Because the average lifetime of a conventional vehicle is 11 years, the mix of cars that can be seen on the road is likely to undergo a gradual change. It won't happen overnight; that much is certain.

For the RAND paper "Autonomous Vehicles and the Future of Auto Insurance," published in December 2020, Stanley interviewed 43 professionals working in the insurance and self-driving vehicle sectors as part of her job at the think tank. Most people believe that the initial use of autonomous vehicles would be in fleet applications, such as those used by ride-sharing and delivery companies. They also said that though self-driving cars would probably have a higher initial cost, this will be offset by the larger fleet size, which will likely result in lower insurance premiums owing to the economies of scale.

What Dangers Are Inherent in Vehicles Capable of Driving Themselves?

WeRide, Argo, Lyft, Cruise, Waymo, and several other companies are testing autonomous vehicles and working on the technology necessary to make them fully operational. The likes of Honda, Ford, and General Motors are just some of the well-known manufacturers that have partnered with or purchased several of these companies. However, we shouldn't expect highways and back roads to be taken over by driverless vehicles and trucks soon. There are still a good number of obstacles and problems to be solved. Legislators, drivers, and insurance companies need to consider these new hazards brought about by the introduction of self-driving cars and the changes they bring to the road.

Insurance Policies and Legal Responsibilities

The majority of the industry professionals with whom Stanley talked believed that current auto insurance would be able to accommodate self-driving cars and that there would not be any significant modifications shortly. The corporate insurance strategy that covered fleets of vehicles seemed to be the most realistic and simplest to implement. The maintenance and fixes would be done on-site. This concept has a built-in mechanism for achieving cost savings.

Currently, the states are the ones in charge of regulating insurance companies. Consequently, the legal handling of these concerns varies greatly from one state to the next. Several states are delving more and further into the issues around insurance and liability associated with self-driving cars. And in certain places, there are no laws whatsoever on the books.

Cybersecurity

According to Stanley's survey, most industry professionals believe there will be an increase in demand for cybersecurity insurance. However, the insurance sector believed they could satisfy customer needs while accurately pricing their products. Your policy for a self-driving car may, in the future, already contain or give you the option to add a cybersecurity rider to your yearly contract for the vehicle.

Claims and Safety

When it comes to determining how accurate policy rates should be, insurance companies are still working through the process of weighing the benefits and risks of the current automated processes. The degree to which automation contributes to increased or decreased levels of safety is another factor that determines the trend of claims. Insurers frequently look to ADASs for additional information.