The popularity of autonomous connected cars is growing steadily in Canada. But provincial governments are playing catch-up with the legislation and regulations, the Canadian Council of Insurance Regulators Fintech Working Group said indiscussions last January.
Governments must try to balance the need to protect the public with the need to address security and privacy concerns, without stifling innovation, the working group says.
In Canada, the federal government regulates the manufacture and importation of motor vehicles and their parts, to reduce the risk of death, injury, and damage to property and the environment.
In contrast, provinces and territories are responsible for regulating drivers and vehicles on the roads, which includes authorizing on-street testing of connected and automated vehicles (CAVs). Approaches to regulating these types of vehicles differ between provinces, so recent discussions have focussed on the regulation of driver conduct, including civil liability in case of an accident.
Ontario
In Ontario, the current legislative framework considers the owner or driver liable for loss or damage caused by negligent operation of a vehicle. However, the Highway Traffic Act and the Insurance Act may need to be amended with the introduction of CAVs. In fact, any changes to the insurance regulatory framework would require changes to the Insurance Act.
In January 2016, the Ontario government launched a pilot project to test automated vehicles. The purpose of this pilot project was to establish rules and to monitor and evaluate the safety of autonomous vehicles before they are made available to the public. By the end of 2020, there were 12 automated vehicle pilot projects underway in Ontario, and no incidents have been reported since they were introduced.
All participating motor vehicles must be insured by an insurer licensed to operate in Ontario for an amount equal to the limit stipulated in the pilot regulation, i.e., $5 million liability coverage or, if there are eight or more passengers, $8 million.
Québec
The arrival of autonomous vehicles on the road has prompted the government and the Société de l'assurance automobile du Québec (SAAQ) to redefine certain key concepts, such as the driver. Also, to allow a pilot project to take place, particularly the one relating to autonomous buses and minibuses, the Québec government amended the Highway Safety Codeto include a definition of autonomous vehicles.
Following the redefinition of the concept of driver under the Automobile Insurance Act, CAV drivers are now protected under the Québec public automobile insurance plan. Other aspects to be considered include the development of specific insurance products that allow consumers to protect themselves from cyberattacks while driving a CAV.
In addition, the Québec government may provide for an exemption from the insurance contribution associated with the authorization to operate a vehicle, and may set the minimum required amount of liability insurance. It may also require the manufacturer or distributor to reimburse the SAAQ for compensation that it will be required to pay in the event of an accident involving a CAV.
Toward the end of 2018, a provision was added prohibiting fully or almost fully autonomous vehicles from operating on Québec’s public roads. Only CAVs with automation up to level 3 are accepted, because their sale is authorized in Canada.
Like regular vehicles, CAVs must provide and maintain a bond (in an amount set by the SAAQ) to cover any bodily injury compensation that the SAAQ may be required to pay, and hold at least $1 million in public liability insurance to cover property damage caused by the autonomous vehicle.
In addition, the sharing of data collected by CAVs with insurers and police at the time of the accident may be necessary to determine the cause of an accident. Insurers will also need this data to assess and quantify the risk posed by CAVs.
A Fichier central des sinistres automobiles (central automobile claims file)has been designed to allow insurers to know the history of a person's driving experience. However, in the context of autonomous vehicles, its value could be questioned, the working group noted. In the short term, it may be more useful to collect information on the loss experience of a vehicle model than that of drivers.
Alberta
In Alberta, the vehicle owner is responsible for the negligence of a driver in possession of the vehicle with the owner's consent. In addition, basic insurance coverage for third-party liability and accident benefits is mandatory. Collision and comprehensive coverage is optional.
In fall 2018, Edmonton initiated one of the first pilot projects in western Canada. As a public safety measure, a trained operator was in the vehicle to stop it if necessary.
In the other provinces and territories of Canada, legislation or regulations contain similar provisions. These jurisdictions will thus face the same issues related to CAVs and will need to amend their legislation.