News Regulations30 Jul 2018

Australia:IAG calls for explicit regulation of driverless vehicles

| 30 Jul 2018

IAG, Australia's largest non-life insurer, says that there is a need for explicit regulation of autonomous vehicles above what currently exists.

Giving its comments in a submission to the National Transport Commission (NTC) on the regulatory changes needed for driverless vehicles, IAG notes that most of feedback received by the NTC supports a self-certification framework.

IAG's submission reads, “However, we believe proceeding down this path could increase risks to the safety of the community in the initial stages of the technology, and that the flow on costs of an impact to safety have not been adequately considered.

“Before committing to a self-certification framework, we suggest the macroeconomic costs and benefits are explored by an appropriate body such as the Productivity Commission for government to have a clear picture of the costs and implications of a range of safety assurance systems.”

Impact of self-certification as proposed on the insurance industry

IAG says that the proposed self-certification regulation creates more uncertainly, there is no minimum standard that would need to be adhered to and based on current information no clearly outlined process for monitoring compliance of automated driving system entities (ADSEs) to their certification requirements. Although self-certification may appear to meet the cost versus benefit equation, IAG believes this may have excluded the costs of failure or breach.

In addition, the proposed safety assurance regulation impact statement offers no analysis of impact on the personal injury schemes in Australia. IAG, though, acknowledges the NTC plans to explore this further. Furthermore, uncertainty around liability and regulation around access to data will add to costs per claim, including legal costs to clarify the liability of all parties. There are also flow on effects of costs and decisions around claims to the broader society including the National Disability Insurance Scheme (NDIS). These costs need to be understood fully in order to make a decision on safety regulation.

IAG recommends that:

  • The issue be referred to the Productivity Commission to explore all costs and benefits of a variety of safety assurance systems.
  • NTC explore international approaches more comprehensively.
  • Costs and benefits of stricter regulation explored more broadly.
  • Should this self-certification model proceed, then minimum safety standards, processes and regulatory instruments for monitoring and auditing compliance must be created.


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