News & Events

Autonomous Cars May Be the Solution to Louisiana’s Insurance Cost Issues

We are at a point now where we can forecast what a future with autonomous cars could yield Louisiana.  The last two years of Louisiana legislative sessions have been centered on lowering car insurance premiums.  This problem is being tackled through different ideas centered on lowering costs for insurers.  These plans have revealed divides between the plaintiffs bar, the insurance industry, car accident claimants, and insurance customers, making consensus difficult to achieve.  Future reduction of insurance premiums may just come from cars becoming smarter and safer than human drivers.  Imagine a commute where every car knows the position of every other car on the road, how fast those other cars were going, and where those cars were going.  An internet-of-things linked autonomous car transit system could help relieve congestion through smart routing, eliminate the need for physical traffic control lights and signs, and even change lane spacing needs and usage.

In addition to all of these efficiency benefits, autonomous cars could deliver a massive reduction in insurance premiums, and perhaps even one day, an elimination of the need for liability insurance altogether.  Legislatively, this solution avoids the political divisions that make legislative reform to tackle Louisiana’s high auto insurance rates elusive.  A safer commute is in the interest of everyone.

Such a future is approaching, though how rapidly is open to question.  For instance, U.S. automaker Tesla currently offers a package it calls “full self driving.”  Tesla’s “full self driving” package has new features released as they become available via software updates to their cars.  Tesla’s endgame is a fully autonomous car that will be “substantially safer than a human driver.”  Other manufacturers are similarly working on such offerings in their cars.

The National Highway Traffic Safety Administration has defined 5 levels of automated driving.  By way of example, Tesla cars can currently operate at level 2, meaning the car can control itself both steering and braking, but a human driver must pay attention at all times.  Level 5 is reached when a vehicle can do all the driving tasks in all circumstances.

In 2019, Louisiana passed La. R.S. § 32:400.1–400.8 to govern automated freight carriers and drivers for hire.  Autonomous vehicles are governed exclusively by this section, though it is sparse and silent as to passenger cars.  The law also grants to the Department of Transportation and Development exclusive agency jurisdiction in regulating autonomous vehicles.  La. R.S. § 32:400.3, the provision that provides the requirements for operating an autonomous vehicle, applies only to “autonomous commercial motor vehicle[s]” without a conventional driver present.  Conspicuous by its absence, the law does not address the usage of an autonomous system when a conventional driver is present.  Given that this situation appears to be the most rapidly developing at this time, the law’s silence on this use case is peculiar.

Thus, in terms of passenger cars currently in production, Louisiana law has no particular guidance at this point other than the current rules of the road.  One expects that the Department of Transportation and Development will issue further regulations on the matter, but the legal mandate at this point is narrow.  While the current law represents a missed opportunity, Louisiana can still leap to the front of encouraging autonomous car adoption.  Louisiana should look to further cultivate this space, giving clear guidance and, perhaps, encouraging automakers to conduct research in the state.  Self-driving cars have the potential to get the most out of existing infrastructure and is an industry that Louisiana should court as part of a strategic plan for the future.  Louisiana should seriously consider how it can encourage adoption of vehicles with autonomous safety features.  Creating a legal environment conducive to the growth in usage of self-driving has great promise to save money, lower insurance premiums, and, more importantly, save lives.