How do you insure a driverless car?

5 July 2016

The Smart Transport Forum is coming to Auckland on 21 July. We talk to Colette Campbell, innovation manager for IAG NZ insurance group about what is coming down the road for New Zealand.

“Transport is a complex issue,” says Colette Campbell. She has spent the last two years immersed in it as part of her work as innovation manager for IAG NZ insurance group.

IAG are pioneering ways to insure the future of our transport system. It’s companies doing the administrative and legal detail that are the unsung heroes of the smart transport movement.

“We’ve got potential and dramatic changes required to legislation and roading infrastructure,” says Colette. “We need to accommodate electric vehicles, autonomous and semi-autonomous vehicles all potentially within a 10 year horizon.  If you think about some of the changes required we need to start looking at it now.”

To a large extent the technology already exists. Most mainstream car manufacturers are developing driverless cars. Tesla cars already have an ‘autopilot’ and even Google and Apple are in on the chase. 

At the same time the Sharing Economy is reshaping how we get around.

Companies like Uber,  CityhopMyCarYourRental  and YourDrive are exploring how to share private car ownership. Fleet vehicle companies like LeasePlan are innovating, offering greater choice away from buying cars outright.

Colette says: “There’s definitely a global trend away from asset ownership. We’ve got a chronic issue of under-used vehicles. They block up our streets and car parks and increase carbon emissions.

“For every ride-share vehicle you can potentially take around 10 cars off the road. If this was incentivised in New Zealand and supported to scale we could rapidly accelerate a solution to some of the big challenges around carbon emission, traffic volume, noise and air pollution.”

One of the key challenges now is for the law and the road system to catch up and cope with what is coming. That’s where companies like IAG, the Sustainable Business Networks’ Smart Transport project and events like the Smart Transport Forum come in.  

IAG has just launched its first insurance product in this new category. The company has been working with a Wellington-based rideshare company. It’s been a complex journey.

“It essentially changes an annual premium to an hourly one,” says Colette. “It also morphs personal insurance on your own vehicle with commercial insurance when you rent it to somebody else. It doesn’t sound so innovative but for an insurance company that blows apart how we do things.

“We hit all sorts of road blocks. We had to really understand and work within current legislation which proved to be outdated for some of the new business models and technologies.

“Companies like Uber are very prominent at the moment. They are having major issues around law not fitting their business disruption model. But these models are here and are no doubt here to stay. So from an insurance point of view it’s, how to do we insure them?

“It’s agility and our ability to do this while staying within current legislation that’s key. New South Wales government turned round a piece of legislation in 90 days to accommodate the sharing economy. I think we could really learn from that.”

“Technology is making new business models and new ways of asset sharing available for us. This has an economic growth opportunity for the government. Whereas before my car might sit in a carpark all day while I work, tomorrow it’s on an App and everybody in the vicinity that I choose, can rent it. That gives me a new income source that’s trackable via technology. It gives the government taxation. So it’s in all our interests to work collaboratively with government and the transport network companies to get on board with the sharing economy.”

Colette will be speaking at the forum and participating in discussions throughout the event.

“It’s bringing together a network of individuals and companies who have the potential to influence the development of a future model of transport in New Zealand,” she says. “The forum will serve to build knowledge and understanding. It will enable networks that can work towards some of the solutions we need. 

“For me it’s a meeting of like minds. There will be fresh perspective and good debate. The opportunity to collectively exploring solutions around the issue is what gets me revved up about it.”

IAG is the parent company of NZI, SBN’s foundation partner.

To find out more about Smart Transport and the forum contact: