The emergence of smart, connective technology in automotive industry had introduced innovations such as Connective and automated vehicles (CAVs) and connected car. From advanced features that help drivers make payment for parking and purchasing through a drive through to entertainment experience and even safety features where vehicles are using sensors to avoid collision, these innovations are revolutionising human mobility in the future. The rise of these innovations however introduces to new risk to the drivers, specifically cyber security issue called automotive hacking. The impact of automotive hacking is as damaging as cybersecurity breach that take place in other industries. Thus, automotive hacking brought about new challenges to auto insurers. Why auto insurers should start considering automotive hacking into their policy?
There are many reasons on the important need to consider automotive hacking into insurance policy. Nowadays, most modern cars are connected cars as they are equipped with internet connectivity. Consequently, the risks that traditionally circulates around liabilities and theft now had begun to include cybersecurity into the landscape, thus the need for new definition and risk prevention method.
The impact of automotive hacking include the hackers gaining access to the drivers’ data and vehicle functionalities. While data privacy breaches can lead to negative impacts such as reputational damage and financial loss, the hacker gaining access to vehicle functionalities are as well problematics as they may lead to accident through vehicle malfunction. Definitely, as drivers are not at full control in preventing such events, they should at least prepared with a policy or plan that allows them to recover from the damaging impacts.
Moreover, the cost of repair for CAVs and connected car is not cheap according to research and road accidents involving CAVs or connected car are not solely based on drivers driving behaviours but also through automotive hacking. This highlight that auto insurers should start considering automotive hacking into their policy as finding the reason behind an accident and determining the ultimate cause of a loss are further challenging than before.
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