AUTOMATED SYSTEMS IN AVIATION: THE IMPACT ON INSURANCE by Roger Sethsson

AUTOMATED SYSTEMS IN AVIATIONTHE IMPACT ON INSURANCE

Roger Sethsson Inter Hannover

FIVE QUESTIONS

1. What are insurers concern regarding the systems?2. What is our concern in terms of liability?3. Do we give discount for aircraft having the system?4. Do we know that aircraft will be equipped with

automated TCAS system?5. If TCAS required for all aircraft (including GA) the

cost will be huge. “We don’t want the cost for the system to be more than the profit to make the system”

AGENDA

• AVIATION INSURANCE BASICS• TCAS LIABILITY – UNDERWRITING CONCERNS

PUTTING THINGS IN PERSPECTIVE

THE AVIATION MARKET VERSUS AUTO

Aviation Market

• World-wide premium $ 6bn• Number of units available to insure 400,000

US Private Passenger Auto Market

• US Premium $165bn

• Number of units available to insure193,000,000

TCAS LIABILITY – UNDERWRITING CONCERN

“Will lawsuits kill the autonomous car?” Source:

“When driverless cars crash, who’s to blame?” Source:

TCAS LIABILITY – UNDERWRITING CONCERNS

Technology risks• Certification, Software, Cyber risks

Catastrophic exposure• Policy limit $ 5bn

Products Liability • US legal system (Jury), Spain (Judge)

Grounding or Non-Occurrence Grounding Products re-call

THANK YOU!