Autonomous Vehicles: Perspectives, Regulations & Insurance

1. NOTE: Copy and paste “presented by” information if using a different layout. PRESENTED BY: Casey Brewer, CPCU Product Manager - AutoAAIS Autonomous Vehicles:Perspectives, Regulations & Insurance

2. What are we covering • Understanding Perceptions and Timelines • Who will Regulate Autonomous Vehicles • Insurance Industry Challenges and Opportunities

3. What does “Autonomy” mean? • Level 0 – No Automation • Level 1 – Driver Assistance • Level 2 – Partial Automation • Level 3 – Conditional Automation • Level 4 – High Automation • Level 5 – Full Automation

4. Why Now? • 37,133 Traffic Fatalities in 2017 • 1.16 per 100M Miles • Down 1.8% from 2016 • Average age of vehicles on the road is 11+ Years • Blackberry’s Market Share peaked 10 years ago • 3 Domestic Automakers have Ceased Operations in this Time • Infrastructure 1.0 • Federal Highway System Act of 1956 – 41,000 mile system of Interstate and Defense Highways that would eliminate unsafe roads, inefficient routes, traffic jams and all other things that got in the way of “speedy, safe transcontinental travel” - Eisenhower

5. Understanding Timelines - Consumers • “Deloitte Study: Consumer Trust in Autonomous Vehicles on the Rise” – January 8, 2018 • “Deloitte Study: Consumers Pump the Brakes on Autonomous Vehicle Adoption” – January 7, 2019

6. Understanding Timelines – Manufacturers “People have had this really unrealistic view of how fast this really groundbreaking technology can be implemented…It’s going to be painfully slow.” – Mike Ramsey, Gartner, Inc.

7. Understanding Timelines – Maybe…? • The “Back To The Future” vision • Cautious Optimism • Crushing Reality • Tesla?

8. Understanding Timelines - Deployment • Iterative/Evolutionary Change • Long Period of Blended Environment

9. Who will Regulate Autonomous Vehicles • National Highway Traffic Safety Administration • Federal • State • Similar to Today • Model State Policy

10. Federal Oversight - NHTSA • Setting Safety Standards for New Motor Vehicles and Motor Vehicle Equipment • Enforcing Compliance with the Safety Standards • Investigating and Managing the Recall and Remedy of non-Compliances and Safety-Related Motor Vehicle Defects and Recalls on a Nationwide Basis • Communicating with and Educating the Public about Motor Vehicle Safety Issues • Issuing Guidance for Vehicle and Equipment Manufacturers to Achieve National Safety Goals Federal Automated Vehicles Policy, USDOT/NHTSA September 2016

11. State Oversight • Licensing (Human) Drivers and Registering Motor Vehicles in their Jurisdictions • Enacting and Enforcing Traffic Laws and Regulations • Conducting Safety Inspections, when States choose to do so • Regulating Motor Vehicle Insurance and Liability Federal Automated Vehicles Policy, USDOT/NHTSA September 2016

12. States with Enacted Legislation or Executive Order

13. Insurance Programs • Understand Customer Needs - Traditional and Non-traditional • Liability • First-Party Injury • Vehicle Protection • Cyber • AV Package

14. Understand Threats & Opportunities • Threats • Long-term, change will occur • Customer needs will change • Who owns Liability? • What new exposures have been created? • Pricing • Customer Experience • Opportunities • Long-term, change will occur • Understand the consumer and own the experience • Engagement at all levels

15. Understand Threats & Opportunities

16. What Have We Covered • Iterative Change is coming • Regulatory Structure will remain similar to what we have today • The Industry will evolve

17. Engage & Evolve • Engage in the journey • Connect with your customers • Engage with Partner organizations

18. PRESENTED BY: Casey Brewer, CPCU Product Manager - AutoAAIS Thank You!