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Research Questions

  1. What changes might highly or fully automated vehicles require to the U.S. automobile insurance system?
  2. What are the benefits and drawbacks of various models of insurance?
  3. Will these vehicles be insured in fleets rather than by individuals?
  4. Will the subrogation process change?
  5. How might accidents involving AVs be handled?
  6. Will AV technologies drive up costs of minor accidents?
  7. How might changes to other countries' insurance systems inform changes to U.S. insurance?
  8. How important is consumer acceptance?
  9. Will data-sharing between AV manufacturers and insurance companies be important?

To investigate the impact that the widespread deployment of autonomous vehicles (AVs) could have on automobile insurance in the United States, RAND Corporation researchers interviewed 43 subject-matter experts from 35 stakeholder organizations and conducted an extensive literature review. A key finding from their research is that the existing automobile insurance system in the United States should be sufficiently flexible to accommodate the introduction of AVs. Experts generally agreed that, although some changes to the U.S. auto insurance model may be indicated as vehicles incorporate higher levels of automation, it is too early to make radical changes to the U.S. automobile insurance system. In addition, a majority of experts predicted that AVs would be deployed in a fleet ownership model, although their predictions regarding the specific formulation of fleet ownership differed. A majority of experts also said that the automobile insurance claims process for accidents involving AVs and conventional cars would not change significantly in the future, and experts agreed that consumer acceptance was very important to the successful deployment of AVs.

In addition, the authors explored experts' assessments of the benefits and drawbacks of proposed future insurance models for AVs, such as statutory no-fault compensation schemes, current no-fault insurance models used in some U.S. states, fleet insurance, and manufacturer self-insurance. They also interviewed experts in the United Kingdom, Australia, Japan, and Canada about how those countries were adapting their insurance frameworks to incorporate AVs and ensure the compensation of those injured in accidents.

Key Findings

The existing auto insurance system in the United States should be sufficiently flexible to accommodate the introduction of autonomous vehicles (AVs)

  • Most experts agreed that, although some changes to the U.S. auto insurance model may be indicated as vehicles incorporate higher levels of automation, it is too early to make radical changes to the U.S. automobile insurance system.
  • A majority of experts predicted that AVs would be deployed in a fleet ownership model, although their predictions regarding the specific formulation of fleet ownership differed.
  • A majority of experts said that the insurance claims process for accidents involving AVs and conventional cars would not change significantly in the future.
  • Experts agreed that consumer acceptance was very important to the successful deployment of AVs.

Recommendations

  • Insurers, manufacturers, and other stakeholders should collaborate to develop a framework for collecting and sharing AV data. Further research to explore methods for information-sharing between insurers and manufacturers could assist the automobile insurance industry in more accurately assessing risk, paying claims, creating new insurance products, and facilitating the adoption of AVs.
  • In adapting existing insurance frameworks to accommodate the deployment of AVs, policymakers and insurers in the United States should consider international insurance frameworks. Policymakers in other countries must also contend with the liability and regulatory implications of the deployment of AVs. Policymakers and insurers in the United States should closely examine these international models, which could provide novel solutions to common liability, coverage, and other issues associated with AVs.
  • Further research to understand the fleet operator model's effects on consumer acceptance would be useful. Insurance coverage for AVs will play a significant role in increasing consumer confidence in these new technologies. Consumer acceptance of AVs will be an important factor in setting the pace for creation of new or adaptive automobile insurance frameworks.

Table of Contents

  • Chapter One

    Introduction

  • Chapter Two

    Tort Law and Autonomous Vehicles, in Theory and Practice

  • Chapter Three

    Stakeholder Assessments of Models for Insuring Autonomous Vehicles

  • Chapter Four

    International Models for Insuring Autonomous Vehicles

  • Chapter Five

    Assessing the Impact That Technologies for Autonomous Vehicles Can Have on Auto Insurance Policies, the Auto Insurance Framework, and Consumer Acceptance

  • Chapter Six

    Findings and Recommendations

  • Appendix

    Supplement to Chapter Four

Research conducted by

The research described in this report was conducted by the RAND Institute for Civil Justice, part of the Justice Policy Program within RAND Social and Economic Well-Being.

This report is part of the RAND Corporation research report series. RAND reports present research findings and objective analysis that address the challenges facing the public and private sectors. All RAND reports undergo rigorous peer review to ensure high standards for research quality and objectivity.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.