Third-Party Autonomous Commercial Trucking Providers: Benefits, Challenges and Risk Management Considerations
The continued advancement of autonomous vehicle technology is creating new opportunities for businesses seeking efficient and accessible transportation solutions. Third-party autonomous commercial trucking providers offer potential benefits, including improved operational efficiency, reduced dependence on driver availability and the possibility of reducing certain human-error exposures. However, these advantages are accompanied by unique risk management challenges, including the potential for evolving regulatory requirements, cybersecurity concerns, technology reliability, contractual liability exposures and uncertainty surrounding responsibility following a loss event.
Organizations considering the use of autonomous trucking services should carefully evaluate not only the transportation provider's safety performance and operational capabilities but also the reliability of the autonomous driving system, maintenance and monitoring practices, and contractual risk transfer provisions. This bulletin highlights the key benefits, challenges, and risk management considerations associated with utilizing third-party autonomous commercial trucking providers.
Potential Benefits
- Increased Transportation Capacity: Can help to address potential driver shortages and transportation constraints
- Reduction of Human Error Exposures: Autonomous driving systems are designed to help mitigate exposures associated with fatigue, distraction and impairment
- Improved Operational Efficiency: Potential for more consistent route execution, on-time delivery, reduced downtime and enhanced supply chain reliability
- Enhanced Trucking Visibility: Autonomous trucks are typically equipped with advanced technology including telematics, onboard cameras and system diagnostics that can help improve fleet oversight and support loss investigations
Potential Challenges
- Complex Liability Issues: As the uses of autonomous commercial vehicles are still emerging, there have been few vehicle incidents to set legal precedent for the responsibility of losses. Responsibility for a loss may extend beyond the carrier to include vehicle manufacturers, software developers, remote operators and other parties.
- Technology Reliability: The safe use of autonomous vehicles depends on software, sensors and communication systems operating as intended.
- Operational Limitations: Most autonomous vehicles are designed to operate within specific conditions known as the Operational Design Domain (ODD), which includes restrictions related to specific routes, roadway types, weather conditions and traffic environments.
- Cybersecurity Risks: Autonomous vehicles rely on software and network connectivity. Cybersecurity events, unauthorized access and malicious software may negatively impact operational safety.
- Regulatory Uncertainty: Autonomous vehicle regulations continue to evolve, and requirements may vary by state and jurisdiction. This may impact transportation operations and insurance requirements.
Risk Management Considerations
Autonomous trucking providers should be evaluated as both a motor carrier and a technology provider. Effective due diligence should consider transportation safety, technology maturity, cybersecurity controls, contractual risk transfer, operational limitations and post-loss data preservation capabilities. An effective carrier evaluation process can help organizations realize the potential benefits of autonomous transportation while managing emerging liability and operational exposures. Items to consider during the vetting process include:
- Prequalify Transportation Providers: Begin with the same diligence you would apply to any contract carrier including FMCSA operating authority, safety performance, inspection and out-of-service rates, crash history, insurance coverage/limits, DOT safety rating and years in operation.
- Evaluate Autonomous System Maturity: Understand the level of vehicle automation, operational restrictions, autonomous mileage accumulated and system disengagement history with corrective actions taken.
- Review Operational Controls: Verify that the service provider maintains documented procedures for route authorization, weather restrictions, emergency response and monitoring protocols.
- Maintenance and Cybersecurity Programs: Formal programs should exist for autonomous vehicle maintenance and cybersecurity controls. Verify controls are in place for preventive maintenance, sensor calibration, software updates, access management and vendor cybersecurity oversight.
- Establish Strong Contractual Protections: Contracts should clearly address liability allocations, hold harmless and indemnification provisions, insurance requirements, additional insured status, access to operational data, claims cooperation obligations and evidence preservation responsibilities.
- Claims Readiness Procedures: In the event of a vehicle incident, ensure procedures are in place to preserve vehicle telematics, video recordings, software records, maintenance documentation and incident investigation materials.
