Report Says Korea Should Look to UK for Autonomous Car Insurance Model

In Korea, the driver is solely responsible for accidents on autonomous vehicles, unless the driver can prove that the accident didn’t result from his or her negligence, but instead from the vehicle’s technical defects or other third-party mistakes. (image: KobizMedia/ Korea Bizwire)

SEOUL, March 20 (Korea Bizwire) – One of the industries that self-driving vehicles will reshape is the insurance sector, and the question of who should take responsibility in the event of an accident is still being debated in several countries, including South Korea, where autonomous vehicles are just starting to be introduced to the market.

In a typical car accident, the driver is responsible unless the vehicle is found to have a technical defect that holds the manufacturer liable. However, for self-driving cars, where the driver becomes the passenger, the situation can become more convoluted. 

Senior researcher Lee Gi-hyung at the Korea Insurance Research Institute, in his latest report on insurance policies for autonomous cars, points to a U.K. precedent as a possible solution. 

According to the report, the British parliament is deliberating legislation that governs insurance policies and liability for accidents that take place under self-driving mode. 

The British government initially considered a voluntary insurance model that holds manufacturers liable unless the driver is proven to be at fault. 

In Korea, the driver is solely responsible for accidents on autonomous vehicles, unless the driver can prove that the accident didn’t result from his or her negligence, but instead from the vehicle’s technical defects or other third-party mistakes. (Image courtesy of eurosporttuning/Flickr)

Officials, however, later assessed that the proposal would make it difficult to offer swift compensation to the victims, while local insurance companies said that voluntary insurance with a liability limit would fail to protect consumers from major accidents. 

Making amendments to the initial proposal, the government later introduced a single insurer model, where the driver alone makes a single claim for compensation with his or her insurance company, which can exercise its right to indemnity from the manufacturer if the accident resulted from a vehicle defect. 

This model also covers the driver, the passenger, and a third-party victim, Lee said in the report. 

“The single insurer model allows for quick compensation to the victim and will contribute to the further development of South Korea’s automated vehicle industry, helping to minimize the social cost (resulting from self-driving vehicles),” he said. “Korea should also consider a thorough evaluation of this model.” 

In Korea, the driver is solely responsible for accidents on autonomous vehicles, unless the driver can prove that the accident didn’t result from his or her negligence, but instead from the vehicle’s technical defects or other third-party mistakes. 

The South Korean government expects level 3 self-driving vehicles to be commercialized here by 2020. Automobiles in this category will be fully autonomous but only in limited conditions, like clear weather, and will require human intervention in emergencies.

By Joseph Shin (jss539@koreabizwire.com)