A one day conference on how insurers can adapt to highly automated vehicle technologies and the growth of mobility-as-a-service

London 1 February


Emergency Autonomous Braking: a no brainer for fleet insurance managers?

Last week the European Parliament formally called for all new cars sold in Europe to be fitted with Autonomous Emergency Braking (AEB) as standard. Analysts expect that EU member states will likely make the technology compulsory in the early 2020s. AEB is available as an option on most models today (at an average cost of GBP 1,300 but sometimes as low as £200) and any individual purchasing a new car should specify it if they possibly can - even if it means forgoing nicer seats or alloy wheels. But for fleet managers there’s really no excuse not to insist on AEB right now. Here’s why.

AEB is an automatic braking system that will engage to avoid or mitigate an accident if the driver fails to respond to an emergency situation. AEB systems use lidar, radar and/or camera technology to identify potential collision risks, taking into account a vehicle’s speed and trajectory. If a potential collision is detected, the system responds by warning the driver and then automatically applying the brakes if no action is taken.

AEB is one of a range of new Advanced Driver Assistance (ADAS) technologies aimed at helping drivers keep control of their vehicle in difficult conditions; and while the jury may still be out as to the real-world effectiveness of some of these driver aids (experts fear they might encourage drivers to relax too much at the controls), there is a wealth of international data available indicating the effectiveness of AEB in reducing crashes and injuries.

The US Insurance Institute for Highway Safety compared the Volvo XC60 and S60 (with a standard fit City AEB system) against a control group and showed a 15% reduction in third party damage claims, and a 26% reduction in personal injury claims.

In the UK, chauffeur firm TriStar worldwide switched to cars fitted with AEB and saw a 27% reduction in rear end crashes by its drivers. Overall repair costs, third party costs and associated charges like hire of replacement vehicles dropped 41% compared to the previous 4 year average.

Speaking at the Insuring Autonomous Vehicles conference in London earlier this year, Andrew Miller, Chief Technical Officer of Thatcham Research, revealed that in 2016 AEB systems were installed as standard-fit on just 21 per cent of new cars available in the UK, whilst a further 27 per cent of vehicles offer the system as an optional extra.

Yet Thatcham calculates that AEB could deliver 308 fewer deaths and serious injuries by 2025 and save society £138 million if the technology were deployed across all new vehicles sold in the UK.

Peter Shaw, Thatcham’s CEO said last week, “There’s an urgent need to change the consumer and fleet mind-set around car safety, especially when AEB can cost as little as £200.”

Fleet operators in particular need to join the dots and see how AEB could positively impact their fleet insurance and operating costs. For the majority of fleet operators, most insured claims (in terms of both numbers and value) are the result of damage caused by the insured fleet driver hitting the third party in the rear.

Rear-end collisions often lead to both third party property damage and third party injury - particularly in the form of claims relating to whiplash injuries. On an annual basis, insured claims from rear accidents typically run into hundreds of thousands of pounds for larger corporate fleets. And as any fleet manager knows, there are significant additional costs to the business on top of the insured cost, including lengthy claims administration, employee absence, vehicle downtime etc.

The resulting claims experience is the main piece of information used by underwriters to calculate renewal premiums, so any material improvement in the claims experience could reduce future renewal premiums.

AEB was made a compulsory feature for all newly registered heavy goods vehicles (over 7.5 tonnes) in the UK back in November 2015. What possible justification could there be for waiting almost a decade before applying the same treatment to passenger cars?

And as Gerry Keaney, CEO of the BVRLA said, “If the combined buying power of fleets and government procurement can be harnessed to adopt AEB it could deliver substantial accident savings very soon.”

So rather than wait for legislation to hit the statute books, fleet managers should be putting AEB at the top of their list of must-haves today. While AEB cannot be retrofitted, it is increasingly available on the vast majority of new vehicles at a cost which is likely to make financial, as well as ethical sense. Fleet managers could consider subsidising cars with AEB technology and thereby making AEB enabled cars more affordable within the pay grade of employees choosing their new company car. However you sell it, few features available today can promise the same ROI in terms of reducing premiums and keeping employees and road-users safe, healthy (and productive).

It really is a no-brainer.