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Self-driving cars mean shift in product liability thinking: RIMS Canada Conference | Canadian Insurance
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Self-driving cars mean shift in product liability thinking: RIMS Canada Conference

IBC’s Mario Fiorino discussed some common views on how the industry can handle defective automated vehicle issues from a personal insurance standpoint

The ongoing discussion regarding the potential mainstream use of autonomous vehicles should include thoughts on reforming traditional product liability principles, according to Mario Fiorino, director, legal and senior counsel, at the Insurance Bureau of Canada (IBC).

Fiorino was speaking on the topic of connected technologies at RIMS’s annual Canadian conference in Toronto on Monday.

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Automobile insurance is not built to cover product liability issues such as negligent design or manufacturing. “The reason for this is…the litigation will be protracted, it will be expensive and the [insurance] system will break down so there is going to have to be a solution,” said Fiorino to the audience of risk managers.

Although Fiorino did not recommend any potential solutions to the issue, he did present some commonly discussed viewpoints in the industry and noted, “The thinking [on this topic] is all over the map.”

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Some stakeholders say that regulatory principles and product liability principles are flexible and can be sorted out, said Fiorino. Others say the auto insurance industry is going to have to go to a no-fault model because there won’t be an element of driver error.

Another avenue could come from the example of the U.K., which is currently exploring legislation that states that the personal line automobile underwriter would be responsible for handling the automobile liability claim on behalf of the manufacturer, but that the insurer can then try to recover costs from that manufacturer, explained Fiorino.

“It’s not an easy puzzle to put together but these issues are going to have to be addressed,” he said.