Autonomous vehicles potentially worth ‘trillions’, with driverless cars in use in five or six years: AXA XL’s Copland

Driverless cars, or autonomous vehicles (AV), could be more widely in use in a matter of five or six years time, with the potential market worth for this technology in the trillions of pounds, Intelligent Insurer has learned.

Adrian Copland, COO at Accelerate, AXA XL, is optimistic the technology could be more broadly in use in less than a decade, albeit in ‘geo-fenced areas’ (set roads or districts) at first.

The AVs that look set to make this possible are part of the innovative DRIVEN programme, which showcased its technology in the real world streets around the Queen Elizabeth Olympic Park in Stratford, London, this week.

Autonomous software from Oxbotica has made this AV system a reality but Oxbotica founder Paul Newman, said such a trial would not be possible without insurance. Fortunately, the programme counts AXA XL as one of its consortium members.

Copland said: “Without insurance none of it could come to market, and it could not be out on the road or at the airport.” He also emphasised that AV “will make the world safer”.

Speaking to II, Copland added: “We might see this AV in geo-fenced areas in the next five or six years, and in 10 to 15 years maybe even more areas. The technology is moving very fast. The economics of this technology will drive it.”

Asked what the commercial value of this technology could be, he said “there is no specific number I can put on it but it is in the trillions [of pounds]. There’s the mobility opportunity, and the entertainment industry are very interested”.

The cars are fitted with a number of sensors which see, monitor and learn from the changing environment around them, constantly feeding this information back to its ‘brain’, a complex programme of algorithms and networked information that enables it to drive safely in challenging environments.

In this trial the car is a Ford Mondeo, but in theory this technology, which includes a box of tricks smaller than a traditional desktop computer that sits in the boot, could be fitted to any vehicle. Another difference from some of the other AV systems already under development is that this system ‘sees’ its environment rather than using GPS or external maps to understand where it is. This means a car could be dropped into any location and, its designers said, it would be able to drive around without any problem.

This is not the first test that the consortium has conducted. The system is currently being used at Heathrow Airport, insured by AXA XL for around half a billion pounds, as well as a previous trial with Ocado, which used it to deliver cabbages. Other areas that are testing this system include mines, quarries and ports. The latter three are all specialty environments already insured by AXA XL, which Copland said had made supporting the development of AV important for the re/insurer.

He said the re/insurer has been using the technology that sits behind the AV to run real time risk assessments, giving a “very micro view of risk”.

It has also put a strategic risk framework in place to address the current lack of historic claims, with Copland explaining that this is how AXA XL works out its exposure. In the future it is likely to mean a different way of thinking about how drivers interact with the vehicle and their environment. Copland added: “It’s still in the early stages but we are thinking about doing a digital driving test, there’s a lot of work going into that.”

In terms of the liability landscape AXA XL said that in the short terms AV “holds up” as there is human driver involved but this will need to change in the next 10 years as the situation evolves.

Copland also said that “the risk will have to evolve from personal lines insurance into a more specialty [lines] world.”

Safety and risk, particularly cyber risk, are a priority for this programme with all consortium members looking at all possibilities and having these ‘what if’ conversations now.

DRIVEN programme director and Oxbotica senior vice president, external affairs Graeme Smith said: “Establishing Britain as a world leader for innovative technologies has been at the heart of our mission and we’re incredibly proud of the steps we have taken to help make AVs a reality on our roads.”

The consortium is made up of Oxbotica, Oxford Robotics Institute, AXA XL, Nominet, Telefonica, TRL, RACE, Oxfordshire County Council and Transport for London (TfL). The jointly-funded £13.6m programme adheres to the Department for Transport’s Code of Practice and TfL's recently published London-specific guidance for Connected and Autonomous Trials.

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