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The nonpartisan, nonprofit public interest group also rejected insurance industry arguments that California Proposition 103's consumer protections would not be necessary as vehicles become automated.
Consumer Watchdog sent its formal comments to Insurance Commission Dave Jones late Wednesday in response to an "informational hearing" on insurance issues surrounding autonomous cars convened by the agency in September.
Read Consumer Watchdog's comments here: http://www.consumerwatchdog.org/resources/2014-10-1_cwd_auto_vehicles_comments.pdf
Consumer Watchdog said that despite a high profile public relations campaign by Google and other high-tech firms suggesting that a driverless car system is just around the corner it will be decades -- if ever -- before fully autonomous, driverless vehicles replace the personal responsibility model, based on a driver at the wheel.
Safety. Consumer Watchdog said safety should be the paramount concern of the insurance industry and the Department, because flaws and failures in automated vehicle systems will pose a potentially catastrophic threat to public safety and lead to more, and more costly, insurance claims.
"Insurance companies, with a continuous stream of incoming claims, are uniquely situated to detect and report patterns of safety failures. Yet industry-wide, insurers continue to maintain their historic disinterest in safety and loss prevention," the letter said. "Industry representatives at the hearing were emphatic about the need to obtain data, but said nothing about using their existing claims data to monitor vehicle defects today."
Consumer Watchdog urged the Department to propose a regulation that would require insurance companies to report such vehicle safety information to the Department (in the aggregate, so no personal data is disclosed). This is a safety measure that would have an immediate impact, the group said.
Consumer Watchdog said it is possible that the technology needed to manufacture vehicles that operate "autonomously" with one hundred percent safety will eventually be perfected. "But in the meantime, under any realistic scenario for the near or even distant future, human drivers will be responsible for maintaining control of their vehicle in order to prevent an accident, just as they must be now," the letter said.
Privacy. Consumer Watchdog said another assumption widely shared by industry representatives at the hearing is that motorists will have to sacrifice their right to privacy in order to benefit from advanced automobile technologies – suggesting that when it comes to their cars, motorists will have to tolerate the practices pioneered by Google and other companies that specialize in collecting and monetizing data about consumers' online and offline activities
"Google and its personal data collecting colleagues will also want to enhance the digital dossiers they already compile for each American by including where motorists are going and what they're doing, so advertisers can target their products, and perhaps subject motorists to the distraction of continuous advertising," the letter warned.
"Barely a word about data privacy was heard from industry representatives at the hearing. Unlike the distant vision of driverless cars, privacy is an area of immediate consumer concern today," the letter said. "We urge the Department to investigate and restrict the growing use of private data by insurance companies. In every respect, sharing personal data should be a choice made affirmatively and voluntarily by the consumer."
Another "Digital Divide"? Consumer Watchdog said it strongly supports the development of new automotive technologies, particularly those that will prevent deaths and injuries (and reduce dependence on fossil fuels). Many of the safety technologies under development today, could, if affordable enough to be widely deployed, significantly reduce the frequency and cost of accidents. However, the group warned:
"Like the much-hyped Google Glass, automated cars may end up an expensive toy for those who can afford it, while the rest of us continue to rely on cars that we drive to take us to work, to family and for recreation. The Department must ensure that insurance companies do not unfairly discriminate against those who cannot afford, or choose not to utilize, automated technologies."
Proposition 103 consumer protections. Proposition 103 was enacted by the voters twenty-six years ago to both hold rates to fair levels and ensure that each motorist's premium is based on rating factors within their control. The organization rejected suggestions by insurance industry representatives that automation technology might render the current "fault based" personal responsibility system obsolete. "In the face of the insurance industry's wishful-thinking, we urge you and your staff to remain vigilant in the defense and enforcement of current consumer protections," the letter said.
"Under any system in which a motorist is or may be required to control the vehicle, the motorist's individual responsibility, as reflected by their driving record, will remain of paramount importance, and thus properly the single most important determinant of their premium, as the statute specifies," the letter said. "Similarly, annual mileage and years of driving experience, along with several of the optional rating factors previously adopted by the Commissioner, reflect the motorist's risk, without regard to whether the policyholder is driving a car equipped with automation technology."
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SOURCE Consumer Watchdog