Auto Insurer Might Sue Tesla Over Autopilot-Related Crash

AUG 21 2016 BY MARK KANE 48

Tesla Autopilot

Tesla Autopilot

Tesla Autopilot

Tesla Autopilot

Being a trailblazer is never an easy task, as example of which is shown by Tesla’s Autopilot.

Despite the fact that Tesla’s Autopilot isn’t actually autonomous driving technology but “only” driver assist (requiring driver attention all the time), it already has raised some questions.

One of the newest issues facing the system, is that car insurance companies could sue Tesla over Autopilot, even if car owner won’t.

In Texas, a Tesla Model S had an accident while operating under Autopilot mode, while the driver focused on something other than driving (in particular, he admits to not paying full attention, as at the moment of the accident he had just removed a cloth from his glove-box and was cleaning the dash), believing that Autopilot would fully do the job on its own while he was busy.

“A Texas man said the Autopilot mode on his Tesla Model S sent him off the road and into a guardrail, bloodying his nose and shaking his confidence in the technology.”

““I used Autopilot all the time on that stretch of the highway,” Molthan, 44, said in a phone interview. “But now I feel like this is extremely dangerous. It gives you a false sense of security. I’m not ready to be a test pilot. It missed the curve and drove straight into the guardrail. The car didn’t stop — it actually continued to accelerate after the first impact into the guardrail.””

Because the driver wasn’t following the rules as set out by the use of the feature, we feel Tesla should be cleared from responsibility, but whether or not it will be a smooth legal battle to prove that fact, is up for debate.

Automotive news reports:

“He doesn’t plan to sue the electric-car maker, but his insurance company might.”

“Cozen O’Connor, the law firm that represents Molthan’s auto-insurance carrier, a unit of Chubb Ltd., said it sent Tesla Motors Inc. a notice letter requesting joint inspection of the vehicle, which has been deemed a total loss.”

Hopefully auto-insurance companies will not provide too much nuisance grief to Tesla (especially in basic accident claims), because lowering the ratio of fatality per miles traveled via a tool like Autopilot is of benefit for the whole society.

Check out some expanded details, and consumer reaction to the prospect of insurace lawsuits at the Automotive News.

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48 Comments on "Auto Insurer Might Sue Tesla Over Autopilot-Related Crash"

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Tesla should stay focused on electric vehicle production, not get distracted by autonomous driving. The safety features like crash avoidance are great but Autopilot should be deferred.

Autonomous cars are clearly the near future of all the automotive industry. It took just a little while for the car companies to figure out why Tesla was pushing hard on auto-pilot.
At the opposite of the race to build good affordable mass produced fully electric cars, the competition will go full throttle very soon on autonomous electric cars. GM has started, and now Apple turned away from the cars, to focus on the software. I suspect all the others are looking for a shortcut to get autonomy as soon as possible.

When you think about it, driverless vehicles will be a ble$$ing for taxis, sharing and all delivery companies. And fully electrics will mean less maintenance, repairs and replacements… and also much less energy spendings as renewables+batteries are taking on

Certainly not a blessing for the drivers

We are unhappily bound for extinction 🙁
But we will take the Fossil Fuel dinosaurs with us 🙂

Let’s enjoy the ~ two decades left with our no pollution no noise powerful BEVs! … and personal drones?

Cheaper transport will mean får more transport.

Yes, but 100% certainly less *privately owned* transport.

I think you can easily make the case that driverless cars might result in even more people owning and using cars. Those who are too elderly or have a physical disability that does not allow them to drive might welcome the chance to own a car that will take them wherever they want without having to drive it, and without having to hire a chauffeur. For example, a friend of mine was recently diagnosed with epilepsy, and now she’s no longer allowed to drive.

Of course, there aren’t many people with epilepsy. But there are a lot of people too old to drive safely!

I’m not convinced by the arguments that people are going to give up the convenience and freedom that owning your own car represents. Sharing a car is essentially the same as relying on taxi or Uber service. Yes, some people live where that’s practical. Densely populated urban areas where there is already dependable taxi service.

And many people, perhaps most, don’t live in such areas, and wouldn’t ever be tempted to give up their freedom by voluntarily giving up their car.

I agree. The auto industry has going like a headless chicken into multiple new frontiers at the same time (electric, autonomous) when it would be better to just focus on one at a time until it is perfected.

I am disappointed all the major auto companies are focusing on autonomous driving. I am not interested in a taxi service. What’s the point of buying and owning a car at that point…

The car you can drive yourself will become like riding horseback, only driving in a closed circuit. It’s a shame the manual transmission will most likely disappear after 2020 since car companies aren’t interested in improving it. How saddening

I’ve driven stick for decades including RHD. When I still drove ICE I abhorred automatic transmission. But, as much fun as stick is, driving a quiet instant torque EV is IMHO better.

For sure. I was going on a long trip a while back and borrowed a gas car for the day. It was a stick shift, and I found myself wondering why I had ever harboured negative feelings about automatics..!

It was actually kinda surreal driving the gas car. Granted, it was not a new or flash car, but the noise and vibration, the slowness of the engine response, and the shifting all made it seem like some museum object. And when I stopped halfway to have a break and a burger I nearly crashed into the wall at the parking lot because I completely forgot I had to depress the clutch – I just pressed the brake..!

So if you were CEO of “MoparOrNoCar Motors” you’d take all the engineers from autonomous driving and re-task to improve manual transmissions? Certain a brilliant way to kill a car company…

It would be foolish of insurance companies to sue Tesla because in the end autonomous end goal driving will end up making insurance companies more profitable if there are less accidents (payouts) but everyone still pays there monthly payments. It’s a numbers game and insurance companies use it to their advantage.

Insurance profits It could go the opposite direction… especially if huge fleets of AV’s end up being owned/operated and self insured by the OEM’s.

Correct. Any in any case their profit is not a function of how much damages they pay – except DURING a change in rates where prices turn out to have been set incorrectly.

If accidents became much rarer the price of insurance would go down as well. At least if there is a functioning market with real competition, nobody has the power to just charge whatever they like.

And like you say, fleets could potentially take on the risk themselves and save the profits the insurance company makes (provided they can do the insurance job equally effectively). I think there are some legal hurdles there (capital requirements for insurers and the like), but for a large corporation they are surmountable.

“…autonomous end goal driving will end up making insurance companies more profitable if there are less accidents (payouts) but everyone still pays there monthly payments.”

That’s not how it’s going to work. With reduced risk, premiums will have to be lowered. The insurance company will be paying out less, but will also have less money coming in due to lower accident rates.

If the company’s profit margin is a percentage of the monthly premium, then lower rates will reduce the insurance company’s profit margin.

Lower insurance rates will be better for everyone except the insurance companies. So I can easily see they might well not welcome autonomous cars. Sadly, they might well see suing Tesla to slow the rate of adoption of autonomous and semi-autonomous features of cars, to be a positive outcome for them.

Or, the insurers could deploy their lobbyists to grease the pock…err..wheels of congress, to insure a ‘floor’ in which rates could not fall below.?

I just don’t see them lowering their premiums / monthly payments that customers are making.

Let’s be clear on just what our point of disagreement is, if any. I’m not suggesting that insurance rates will be lowered today or tomorrow for cars with semi-autonomous features. I’m stating that it’s pretty self-evident and inevitable that the lower accident rate for self-driving cars, once their reliability is proven, will inevitably result in lower insurance rates.

If you disagree with that, then you’re essentially saying that market competition doesn’t actually lower prices, which would be denying reality pretty firmly.

But perhaps you only meant that autonomy in cars is not yet sufficiently developed for insurance companies to have any reason to lower insurance rates on such cars. If that’s your point, then I agree.

All I can say is, good luck with that.

I first read about this accident on, and if the driver was actually on a proper divided highway, he had to cross over at least one Kane before hitting a guardrail! Many years ago, back in 1984, I nearly pasted the side of my expensive, aftermarket modified RX7 Turbo, when I drifted from the right hand lane into the left, and was under 8 feet away from a rock face on the Mountain Road of the Trans Canada Highway, driving North, just South if Yale, BC. A sharp and quick crank of the wheel to the right, and then left, put me back in my lane, but my Heart was very much racing! Wasting a further 1/2 a second could well have been either deadly, or at least messy and expensive! Truth be told, it was well past Midnight, and I had nodded off, and had to make that abrupt maneuver immediately after opening my eyes, so EVEN if the Autopilot had been disengaged in this instance, I would bet I could have kept it safe, even with one hand on a cleaning cloth, if one hand was on the wheel! Sorry to hear this guy was a case… Read more »

It does seem like a case of an absent-minded driver, yes. But it is equally clear that his absent-mindedness was a direct consequence of his assuming the car would handle the driving, just like it “always did”.

Humans are habit-forming creatures. If you monitor something a hundred times and it apparently reliably does the same thing, that monitoring task becomes tedious. The human thing to do is to reduce the intensity with which you monitor it. Do that a hundred times more and perhaps you won’t be paying much attention at all.

I don’t know if autopilot should be allowed or not, and whether the responsibility should be only the drivers or not. But I do know that these are not questions for Tesla or any other car maker to decide.

A lawsuit could establish some principles, but it is pretty obvious that this is an area that will need regulation, and certifications, and quickly.

I’m trying to understand why the driver is not bringing a lawsuit against Tesla. Seems odd that his insurance company is and he’s not. I believe there is more here than meets the eye. Tesla where are the logs to tell us what happened

There’s nothing in this article – except the title itself – about the insurance company suing Tesla.

“…via a tool like Autopilot is of benefit for the whole society…”

This terrifies the insurance companies. What will they do once the cars are driving themselves and EVERYONE opts for the super low coverage super high deductible insurance? Premiums will go down. And with few accidents, there will be no reason for the insurance company to jack them back up.

True autonomous cars are the end of the auto insurance industry as we know it. They’re going to sue Tesla to make sure that imperfect human drivers remain behind the wheel as long as possible.


Storms still happen. stuff flies off trucks. Definitely a transition period, though.

I’ve got a feeling that a self driving car will be smart enough to make it really difficult for you to drive it through a storm. In the interest of safety, it might just say “I’m sorry Dave, I’m afraid I can’t do that.”

That’s an easy question to answer. The insurance companies won’t have super low coverage. They’ll just remove that option so that the lowest option coverage is what you’re paying now as a human driver.

Then they’ll jack up the rates for human drivers… as they deem they’re too dangerous.

American Lawyers are well known for suing anyone over anything, until your money runs out. Sometimes a phony suit gets a payoff, to just avoid bad publicity.

So Tesla may quietly settle for part of this accident, even though the driver was clearly not paying attention.

While Tesla has good grounds to win in court, the bad publicity could hurt them anyways. Is it Tesla’s fault that some drivers watch videos or fall sleep? You can’t protect yourself against every clown and moron abusing a car. I have even seen a picture of a dog driving a Tesla.

(Note: I don’t know if that pic was real or faked. But it could happen, if a reckless person sat a passenger, and kept a hand on the wheel and put the autopilot on by pedals and reaching over. The dog could appear to “drive” for about 3 minutes, freaking out every other driver on the road. Would you say Tesla was responsible for a clown like that?)

Well, one question is the responsibility for this or any particular accident. Another is the question of what effect the autopilot actually has on drivers. This guy clearly claims what some of us believe to be the case: habit lulls users into a false sense of security. Now, most of the time that doesn’t cause any problems, because the system usually functions as expected or the driver is aware enough to be able to intervene. It is the same thing with accidents when no autopilot is involved; most of the time it is human error, but the person was doing nothing worse than most of us do multiple times a week – they were just especially unlucky and happened to do it at exactly the wrong time in exactly the wrong situation. Fiddled with my phone? Checked that message I felt coming in? Anyone who EVER does any of those things does compromise their own safety and others, compared to if they did not. The best thing about autonomous cars is that they can eliminate the problem of humans’ humanness behind the wheel – our limited attention span, our tendency to get bored, inability to always get excellent sleep and… Read more »
Actually, all the firm did was ask for permission to inspect the car. This is a standard practice of insurance companies in cases involving larger sums of money(I would assume the car’s value was in the area of $100,000). It is entirely possible that the Auto Pilot feature did not respond properly, even though we know that the driver failed in his responsibility. It is not up to an insured to decide if the insurance company(the entity that paid for the damages)is allowed to or should investigate their options to recover what they paid out. It does not make them the “bad guys”, it’s just perfectly appropriate to try to see what they might get back. Assuming that the Auto Pilot did not malfunction, then the company is likely to give up in its efforts. However, if there was something that went wrong with it that contributed to the crash then they have an obligation to try and get some money. I am familiar with this law firm(well known insurance company defense firm)and they are considered above board and ethical, excellent lawyers. There may be no lawsuit at all, but there may be a request for Tesla’s liability insurance company… Read more »

The scariest tidbit is the one about the car continuing to accellerate after the impact. It isn’t the first time this claim surfaces, but to my mind it indicates a very serious bug. After all, an impact hard enough to bloody your nose is something that should be pretty easy to detect reliably. And in an impact the car should probably be designed to not accelerate even if the driver pushes the gas pedal – as he may very well be unconscious.

To the extent lawsuits would distract and/or hamper Tesla’s progress they would be a bad thing. But some legal clarification is clearly necessary. Tesla of course says it is a clear-cut matter and the driver has the responsibility. The insurance companies however won’t sue unless their lawyers believe there is some chance of success – and until it has been tried in a court all anyone can really offer is their opinion. It would be good for Tesla, their customers, insurers and everyone else to get a confirmation that the driver really IS responsible whatever the car is up to, or else some better idea of where the drivers responsibility ends and the car maker’s begins.

For an impact to bloody a driver’s nose, it would have to deploy the airbag.

So in theory they could sue cellphone makers and providers after accidents due a texting/Pokemon distractions.

…And I’m awaiting to when they will sue other car makers because they make cars capable of going at 140, 150, 160mph and we know that an accident at these speeds will make far more damage to the car and persons than an accident at the authorised speed limit…

Although I am a huge Tesla fan, I disagree with their policy of using customers as beta testers. I know, they warn them etc. but still I don’t think most people really know the responsibilities of being a beta tester and don’t appreciate that this software is a long way from being refined enough to truly being a safe autopilot. If an insurance company sues them, maybe they will smarten up.

They’re not using customers as beta testers unless the customers specifically WANT to beta test. This is the agreement you accept when you first enable autopilot. You even get an on-screen agreement pop-up. Nobody is being forced to use autopilot so your point is moot.

This is the thing I hate about America. Nobody takes personal responsibility; they’d rather just sue/blame others for their own dumb mistakes. If you choose to use beta technology then crash because you’re faffing around in your glove box, you have none but yourself to blame. Why is this so hard for Americans to grasp?

Nobody forces any Tesla buyer to be a Beta Tester: Everyone make a conscious decision to request the Autopilot Option, Pays for it, knowing it is in beta, and again, accepts the parameters of requiring hands on the wheel, following the car through as it is engaged, when they select that option in the car! If people are suddenly freaking out, they might want to just not buy into the option just yet, save their money, and drive the car normally! While Elon loves his creation, he really has no idea for how much more careless and idiotic things people will do, and then blame the product for failing! Elon still thinks people are thinking, but many are not! Every Airline Pilot uses Autopilot Equipment far more complete and hundreds of times more expensive than the option on the Tesla, and THAT Still Does Not Avoid Mid-Air Collisions, of Flying Into A Mountain! Sure, OTHER Systems will warn you of some of those things before they happen, but the Pilot is still In Command, and has to take over, sometimes with little warning, after hours of boring Autopilot Controlled Flight, and avoid the pendind crash, collision, and impact! No Pilot,… Read more »

Hear, hear!

Well said, Mr. Weekley.

Their “beta” performs better than every other manufacturers “finished product”.

Not everybody knows what a ‘beta’ system means. Tesla’s instructions do not define ‘beta’, probably because they would have to admit in clear, laymans language that the system is not ready and therefore prone to potentially dangerous failures.

If you aren’t educated enough to know what beta tester means, you shouldn’t buy a Tesla, Uber offer great service instead.

the thing is, the guy referenced in this article didn’t even know that he was a test driver. how likely do you think it is that the guy read all the “fine print” that tesla issues in connection with the autopilot feature?

the thing is, tesla sells the autopilot feature as an option, like any other option. so it looks like it is a final product.

Typical FUD B.S. from a perpetual Tesla basher. As usual, this B.S. is easily refuted with actual facts.

Here’s a screen shot of the actual screen in the Tesla Model S, which you have to use to activate AutoSteer:

One way to avoid this is for Tesla to get into the insurance business and insure their own customers. I wouldn’t be surprised if this is illegal, but I think that all auto companies should insure their own customers. As it is auto companies have incentive to design their cars to be expensive to repair and they make more money from the insurance companies. If they self-insure, then they would have incentive to reduce repair costs and that in turn would allow them to be more competitive.

At this point, insurance companies either already know about autopilot, or should rightfully know based upon their own obligation to do their own due diligence on the vehicles they insure.

And just like all other cars, with all kinds of different safety features and safety ratings, the insurance companies only have two options:

1) Issue insurance at rates appropriate to whatever risk level they project for each vehicle. Tesla isn’t determining their insurance rates for them, they are responsible for that themselves.

2) Or they may choose to simply not insure any model of car. Tesla isn’t forcing them to offer full coverage policies, that is entirely their choice.