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Mercedes’ New Plan Could Set a Precedent for Autonomous Car Liability

In operation, Mercedes’ new Drive Pilot appears to be similar to many other “traffic jam assistant” solutions available on the market. A Drive Pilot-equipped S-Class or EQS will assume command of the car’s speed, steering, and brakes on specific highways below 40 mph to move you forward in traffic. However, there is one significant difference: once Drive Pilot is engaged, you are no longer subject to autonomous car liability for its operation until it is disabled.

You have the option of averting your gaze, watching a movie, or zoning out. It is Mercedes’ problem, not yours, if the car crashes when Drive Pilot is on (1).

Mercedes’ semi-autonomous technology outperforms Tesla’s AutoPilot and General Motors’ SuperCruise by a long shot. It is not just a conceptual system, either. All German roadways have already been certified for the usage of Drive Pilot, and Mercedes hopes to have it on the road in the United States by the end of this year.

In short, in some instances, Mercedes-Benz will henceforth accept direct responsibility for its S Class and EQS cars when they are put into autopilot mode. And Mercedes’ announcement might have far-reaching consequences for the vehicle insurance market.

Auto insurers may see their whole addressable market shrink as autonomous systems take control of vehicles, and car companies are responsible for autonomous car liability in many cases.

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More About Drive Pilot and Autonomous Car Liability

Gregor Kugelmann, Drive Pilot senior development manager, told Road & Track (2), “by the end of 2021, we were the first automaker to gain worldwide certification for a Level 3 system.”

“By the end of the year, we hope to have it for California and Nevada, and we’re looking into several other states as well.”

There are few federal restrictions governing automated driving in the United States. Individual states regulate such systems and determine which businesses are permitted to drive semi-autonomous cars on public highways.

The vast majority of states now lack a regulatory framework to govern the adoption of autonomous or semi-autonomous cars. It is a stumbling block, but Mercedes recognizes that widespread adoption of this latest tech would necessitate extensive collaboration with governments.

In an interview with R&T, Mercedes’ vice president of automated cars, George Massing, said (3), “I would think that some other states here in the United Jurisdictions may embrace the restrictions imposed by pioneer states such As California and Nevada.”

“Then, they would have maybe two or three particular regulations in their territory. However, because of the way you guys are organized as a country, we will most likely have to deal with each state,” added Massing.

Mercedes’ willingness to assume semi-autonomous and autonomous car liability will undoubtedly influence the company’s chances of gaining regulatory approval. While the difference may be legal nitpicking, removing driver accountability necessitated a significant technology leap forward from existing Level 2 systems.

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The Superiority of Drive Pilot From Level 2 Systems

Notably, most advanced semi-autonomous currently available in the United States, including GM SuperCruise and Tesla Autopilot, fall under Level 2, where drivers are expected to supervise the system actively and be ready to take over at an instant whenever the system disengages.

It employs higher-quality image processing and LiDAR scanners and data from Galileo, GPS, and GLONASS satellites for guidance. Unlike any other driver-assist system now on the market, Drive Pilot is devised to offer drivers a 10-second warning before turning off; developers had to ensure that the system would pass over control securely and without error in any situation.

Due to these self-imposed constraints, Mercedes had to deal with conditions that present Level 2 software can’t manage. For example, today’s semi-autonomous systems don’t know how to recognize oncoming emergency vehicles; it’s up to the driver to spot flashing lights and sirens and take control of the car to make room.

The software must respect the law because Drive Pilot and its maker, Mercedes, hold autonomous car liability for the vehicle’s functioning. The system can’t handle the complexity of clearing a path for an incoming ambulance, fire engine, or police car; instead, it employs microphones and cameras to identify emergency lights and sirens to deliver the full 10-second warning before manual handover.

Because of the long buffer time, Drive Pilot is the first system that allows drivers to engage in something else while the vehicle works itself. Mercedes claims that the system can withstand aggressive cut-ins from other vehicles, heavy traffic, and even road debris.

Drivers in Germany can lawfully use their cellphones while using Drive Pilot, a first for semi-autonomous systems; Mercedes does not expect state governments in the United States to change drowsy or distracted driving regulations to exempt autonomously driven vehicles very soon.

Still, the difference between continually watching frequently baffled beta software and genuinely being able to delegate driving duty should be significant.

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The Progress

Mercedes received the coveted “Level 3” accreditation (4), which allows a driverless system to legally operate without the assistance of a human driver in specific situations.

Tesla, the leader in autonomous vehicles, and General Motors both have Level 2 certification (5). A person must oversee a robotic vehicle at Level 2 or risk being arrested (6).

However, some completely autonomous vehicle efforts, such as GM’s successful bid to produce automated cars without manual controls, have cleared regulatory thresholds (7).

There is also a catch with the Drive Pilot system since handing over a complete driving responsibility needs extremely particular circumstances (8).

Drive Pilot can currently only be used on limited-access expressways with no stoplights, traffic circles, and other traffic control systems and also no construction zones at speeds under 40 mph (60 km/h in Germany). Mercedes must map eligible routes for Drive Pilot use (much like GM SuperCruise); the carmaker has previously mapped every such roadway in Germany and the majority of those in California and Nevada.

Moreover, the system will only work during the day when the weather is clear and there are no overhead obstructions. A handover warning will be triggered in case of inclement weather, construction sites, underground, and emergency vehicles. And no, you won’t be able to close your eyes or fall asleep while it works.

According to the R&T report, Mercedes had invited journalists on a ride-along to demonstrate Drive Pilot in LA with a trained driver at the wheel. And the impression was precisely the same as riding in a chauffeur-driven sedan, save from the development display of the computer’s view of the environment (with labels categorizing every vehicle in view and a weight estimate).

Drive Pilot was substantially smoother and more capable than any other semi-autonomous driver aid now available, especially when other cars cut. On Level 2 vehicles, it’s a common occurrence that necessitates driver intervention.

The only snag that the R&T journalist saw was when the vehicle mistook a set of flashing lights on a road sign for emergency lights, resulting in a 10-second warning and manual take-over.

Many of us have gotten accustomed to Tesla’s brazen maneuvers (9). This system frequently puts its driver in difficult situations before abruptly disengaging, handing over control with almost no warning and no regard for whether the driver is paying close attention.

Many of us have gotten accustomed to Tesla’s brazen maneuvers. This system frequently puts its driver in difficult situations before abruptly disengaging, handing over control with almost no warning and no regard for whether the driver is paying close attention.

In light of this, Drive Pilot represents a significant milestone for the budding self-driving car sector. For the first time, a customer-facing semi-autonomous driving system is not reliant on the beta test’s crutch or the human operator’s constant attentiveness. Drive Pilot is a self-assured, capable robot that can now legally drive.

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The Impact of Autonomous Car Liability on Auto Insurers

Following Mercedes’ announcement, insurers may enter a new era.

Professional services organizations have advised vehicle insurers to broaden and alter their coverage offerings to remain relevant (10). Even if people do not have fully autonomous automobiles for another decade, fleets of fully autonomous taxis are expected to become widely available in the second half of this decade (11). It could lead to a significant drop in car ownership.

Below is what Deloitte suggests insurers may do to fortify their market positions:

autonomous car liability
Image: Deloitte

After all, insurers can’t afford to be laggards when it is about modernization, considering the fundamental shift in their insurable ruts.

The insurance industry is confronted with disruptive forces that need nimble and quick responses with autonomous car liability. It is time for auto insurers to maintain relevance amid this changing risk landscape and the potential for increased competition from conventional and nonconventional sources.

We can expect insurers with a diverse product mix and flexible business model to thrive going forward as societal and technology trends shift at an uneven pace in the insurance and autonomous cars industries.

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We can also see more movement towards the subscription service as more automakers assume autonomous car liability. There are chances for companies to either negotiate directly with auto insurers or cover the legal responsibility themselves via a subscription service (12).

It is funny that until 2019, the auto insurance market worldwide was valued at more than 739.20 billion USD and was estimated to reach 1 trillion USD by 2027 (13). However, the recent developments suggest that it can shrink at a dramatic pace if the rate of car ownership drops.

Nonetheless, there is no doubt that the entire way we travel from one point to another is changing. And such transformation is now creating a new ecosystem of personal mobility whose implications are not limited to the automotive industry alone.