50 predictions: Motor

Published 19 September 2017

Limited hands-off driving to be piloted on motorways by 2019
The next stage of vehicle automation, with the introduction of limited hands-off motorway driving, is due to be permitted by 2019 and it will raise tricky issues for insurers. Drivers of vehicles fitted with sophisticated assistance systems will be able to take their hands off the steering wheel for up to three minutes at a time. Crucially, the driver must remain engaged and will be responsible for taking back control of the vehicle in the event of an emergency situation or system failure. This transition could pose problems when deciding liability for accidents. Effective investigation and settlement will depend on being able to access the data from the vehicle and collaboration with vehicle manufacturers will be crucial. Notwithstanding the Automated and Electric Vehicles Bill that will put in place the necessary insurance framework for level 4/5 ‘driverless’ vehicles, it is not anticipated that fully automated driving, whereby the driver can engage in non-driving related activities while the vehicle is in motion, will become a reality on Britain’s motorways until at least 2021.

Subrogation claims portals set to reduce life cycles and claims costs
The use of portals that match subrogated claims between insurers, before automatically analysing and settling them without the need for human intervention, is gathering momentum, with a number of large composite general insurers having already signed up to new digital platforms. While the ultimate success of such InsurTech solutions is reliant on widespread industry use, by removing manual intervention, claims will be settled quicker and more efficiently, avoiding unnecessary litigation and freeing up insurance claims handlers to focus on more complex claims requiring technical human input.

New qualifying criteria will regulate behaviour and enable MedCo to show its teeth
Prior to the introduction of the new qualifying criteria in late 2016, MedCo had been hampered by gaming of its system of randomised allocation of Medical Reporting Organisations (MROs) for the provision of first reports in soft tissue injury claims. The new beefed-up criteria will prevent shell MROs from operating within the MedCo space. By significantly tightening the definition of an MRO, so that each organisation must be a functioning entity in its own right (responsible for day-today activities such as instructing medical experts, managing appointments, validating and managing expert accreditation and ensuring experts comply with legal and regulatory requirements), the loopholes in the system have been plugged. The new criteria will also provide MedCo with the necessary teeth to penalise those organisations that fail to comply.

Civil Liability Bill set to tighten the definition of whiplash ahead of soft tissue injury reforms
The last Government’s proposed whiplash reforms, which promised to reduce compensation payments for minor injuries using a tariff-based system and also increase the small claims track for road traffic claims to £5,000, were stalled when the Prisons and Courts Bill fell away when Parliament was dissolved before the snap general election in June. The new Government remains motivated to tackle the UK’s compensation culture and bring down the spiralling cost of motor insurance for consumers, and has proposed the Civil Liability Bill to achieve these aims, alongside stronger regulation of Claims Management Companies through the Financial Guidance and Claims Bill. The definition of whiplash was very narrow under the Prisons and Courts Bill, meaning soft tissue shoulder and lower back injuries were potentially exempt. Expect the definition to be broadened under the Civil Liability Bill.