Autonomous vehicles are reshaping the foundations of motor insurance, with liability increasingly shifting from drivers to technology providers, according to a report by online publication Insurance Business Magazine.
As automation deepens, responsibility for decision-making is migrating into software, sensors and telemetry systems. Simon Smith, claims director at Carpenters Group, told the publication that as control becomes fully automated, liability will sit primarily with the product and technology stack rather than the human occupant.
That shift represents more than a technical adjustment for insurers. It signals a structural reallocation of underwriting risk. While current UK testing has highlighted system disengagements — where control passes back to a human supervisor — the longer-term trajectory points toward embedded decision-making within code.
For motor insurers, this creates classification challenges. Autonomous vehicles do not fit neatly within traditional motor lines, yet nor are they purely product liability risks. Instead, the market may move toward layered cover, combining core motor liability with elements such as errors and omissions insurance, already seen in parts of the US market.
The result is not the disappearance of motor insurance, but its transformation. As underwriting increasingly incorporates data services and telemetry architecture, insurers are being asked to absorb both road risk and software failure within a single framework.
For a sector historically structured around human error, that marks a fundamental evolution in how motor risk is assessed and priced.
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