Self-driving cars raise products liability concerns

While some speculate that widespread use of self-driving vehicles could “annihilate[e]” auto insurance policies for consumers, as recently reported by the New York Daily News, others are predicting that product liability coverage will increase insurance premiums for manufacturers of automated vehicles and fleet operators. Other types of coverage related to that increase could arise from risks related to public infrastructure and digital or cyber security. Self-driving cars raise product liability concerns because as computers replace humans in controlling the operation of the vehicle, automakers take on liability for their products when accidents occur during that operation.

According to the New York City Bar, a product liability case may arise under theories of strict liability, negligence or breach of warranty. Depending on the circumstances of a particular case, if an accident caused by a self-driving car led to damages, a person may have to sue the designer, manufacturer, or retailer to fully recover. If covered by product liability insurance, an insurance company could defend against the suit on behalf of the putative defendant. Depending on the extent of damage and the likelihood of contributory negligence on the part of the driver, such suits may be able to settle out of court.

Failure to warn is among the major elements of product liability suits. Manufacturers and retailers seeking to avoid liability would ensure not only that their warnings sufficiently put drivers on notice of the dangers associated with automated driving systems but also that such warnings were accurate and free from defects.

As self-driving cars become more prevalent, manufacturers, retailers, and others will have to carefully balance the advertisement of their products’ automation capabilities with the sufficiency of their warnings to consumers about the risks inherent in relinquishing control of the driving experience. 

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