Policy Brief: Reshaping Liability and Insurance Rules for Automated Vehicles

Reshaping Liability and Insurance Rules for Automated Vehicles

By Gordon J. Anderson, Austin L. Brown, and Hannah R. Safford.

The American civil liability framework has two basic goals: ensuring the efficient compensation of victims for their injuries and assigning the cost of compensation to the blameworthy party. When it comes to auto crashes, the existing liability system achieves these goals by assigning liability based on human fault and requiring human drivers to carry insurance. But this system, and the legal theories that support it, are predicated on the assumption that car crashes are traceable to human driver error.

In the near future, automated vehicles (AVs) capable of self-driving will come to market. These vehicles will sometimes crash while operating in a self-driving mode. The problem is that the current vehicle liability scheme does not neatly translate to a world where driving errors are made by nonhumans. Failure to update liability laws could be a missed opportunity to promote AV usage and thereby maximize the technology’s safety benefits. Furthermore, a patchwork liability scheme that varies between jurisdictions can jeopardize efficient victim compensation and fair liability assignment.