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Drones, Driverless: Risks, Opportunities

Legal experts say drones and self-driving vehicles offer both great opportunities and new exposures for the insurance sector. Federal and state lawmakers have passed laws regulating self-driving vehicles.
December 11, 2017

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Legal experts say drones and self-driving vehicles offer both great opportunities and new exposures for the insurance sector. Federal and state lawmakers have passed laws regulating self-driving vehicles. The movement toward autonomous vehicles and drones raises a host of liability questions, including whether the potential liability can be limited through corporate and contractual structures, says Jeff Seul, partner and chair of Holland & Knight LLP’s technology industry sector group. He notes that U.S. courts are "very respectful" of the corporate liability shield, and recommends that companies operating in this space consider establishing subsidiaries to house most of these particular exposures.

The U.S. House of Representatives unanimously passed legislation in September that would define the roles of federal and state and local governments in regulating self-driving vehicles and a clearer pathway for the cars to get to market, while provisions on drones were included in legislation to reauthorize the Federal Aviation Administration. Meanwhile, 21 states have passed laws related to autonomous vehicles, and 43 states adopted laws covering drones, with dozens of more bills pending.

Julia Palmer, a partner with Holland & Knight, said addition to traditional auto insurance, which will still be necessary despite the evolution toward autonomous transportation, other potential coverages include cyber, products liability and public infrastructure policies. “I think it is a new world and lots of new possibilities out there, particularly for the insurance industry,” Palmer said. “Drones are a big opportunity for the insurance industry.

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