Integrate Insurance & Innovation

California is a hotbed for innovation and the growth of technology, but our government agencies have not done a good enough job at keeping pace with changing industries. In particular, CDI needs to evolve as the world changes. The agency should be able to match the pace of innovation, and be able to identify and address potential conflicts relating to new industries before they become a major problem.

Unfortunately, we’ve seen the consequences when CDI is one-step behind innovation, rather than ahead of it. A few years ago, the death of a six-year-old girl when she was hit by an Uber driver in San Francisco shocked the community and it became clear that issues of liability had not yet been worked out. It should not have had to take such a tragic outcome before these foreseeable issues were addressed.

There are several areas on which the next Insurance Commissioner should focus. The first relates to insurance surrounding autonomous vehicles. It is estimated that by 2035, there will be 23 million fully autonomous vehicles on the road. Many of them will be operated as part of fleets owned by companies like Uber and Lyft, rather than owned by individuals. CDI needs to begin answering the questions pertaining to how these vehicles will be insured and who will hold the liability in case of an accident, as happened in Arizona, and how to handle the new lines of insurance associated with these cars – including product liability and public infrastructure. Another area of interest should be in how to insure against cybersecurity threats. Recent breaches into Equifax, the DNC, and the country’s election security have been highly publicized – consumers are more knowledgeable about security risks than ever before. CDI needs to get ahead of what could be a growing demand for insurance against these kinds of threats, and what that insurance might look like.

In order to address these issues, Dr. Mahmood will convene a working group of technology and business experts to insure that CDI is on the cutting edge of technological innovation and that the agency is able to address potential insurance-related issues regarding new innovation, before they become problems for everyday Californians.