Data from the government’s e-scooter trials could be useful for risk assessment and underwriting, as the vehicles take to the roads this month
As lockdown comes to an end in June, government trial e-scooters are set to be on UK roads and cycleways this week (7 June 2021) across several boroughs, including London.
However, while solo travel micromobility may be of particular benefit during the Covid-19 pandemic, when social distancing has been necessary, the broader implementation of e-scooters also brings emerging risks for the insurance sector.
Alistair Kinley, director of policy and government affairs at law firm BLM, told Insurance Times: “A high take-up during the trials in London could provide invaluable evidence to inform decisions about the effective regulation of scooter use once the trials have finished.
“The flip side is that although hired e-scooters in trial fleets are authorised, it is still illegal to use privately-owned e-scooters on the roads.”
Insurance Times examines the impact of the e-scooter trials on the insurance industry and what considerations need to be taken into account when assessing associated risks.
Building data
As e-scooters are relatively new as a motor vehicle, there is little claims data available on them. However, the government has made it clear that data is essential to assessing e-scooter risks.
Speaking during a webinar hosted by law firm Weightmans in February, Matthew Barrie, country manager for UK and Ireland at e-scooter provider Bolt, highlighted that technology inside Bolt’s e-scooters can detect heavy breaking, sharp movements and collisions. Therefore, if a crash does occur, the user can self-report via an app.
However, accurate data on e-scooter incidents from the police is more difficult to obtain, noted Michael Hodder, chief inspector of the Roads Policing Unit (RPU), Surrey and Sussex Police, because e-scooters are classified as ‘other vehicles’ in the police’s crash system.
Plus, data may be varied because of where the e-scooter trials are taking place, Hodder added.
Marsh-backed insurtech Zego has been working on building the underlying data infrastructure for e-scooters after partnering with some operators involved in the government trials to provide insurance.
Risky bits of kit
Despite the current lack of available data around e-scooters, Kinley emphasised that ”they are still risky bits of kit” when used on roads - a consideration insurers and brokers need to be aware of.
For example, Moscow imposed a 9mph speed limit for e-scooters in the city centre in June following a string of accidents, including one in St Petersburg which left David Zaleyev, a ballet dancer from the Mariinsky Theatre, temporarily in a coma.
Kinley continued: “They are still risky bits of kit and people in private land settings and construction sites should check they have cover for them in other types of policies, [such as] employers’ liability or public liability.
“Where you have dual purpose vehicles - [a] cherry picker or crane are the obvious examples - the policy configuration should be that when it is moving from job A to job B, anything that happens there is a motor risk.”
Aside from the physical risks surrounding e-scooter accidents, Kinley noted there is also a legal risk if individuals opt to use privately bought e-scooters as opposed to the ones available via the government’s trials. He believes there is general confusion over what is legal and what isn’t.
“The attraction of using e-scooters in the pandemic seems to have taken over any kind of perception of whether or not it is legal,” he said.
“It is illegal to use private e-scooters on the road other than using hired e-scooters in defined trial areas.
“Unlike Covid foreign travel restrictions, this is not a question of red, amber, green - it’s black and white.
”Hired e-scooters are legal and properly insured, private ones aren’t. You could get caught and have points added to your licence for using [private] e-scooters on the road.
“I think the position of e-scooters needs to be clearer. There’s a mismatch between what the public thinks it can do and what it is actually authorised to do.”
Crystal ball broking
This legal conundrum poses challenges for brokers too, added Glyn Thompson, head of the Forum of Insurance Lawyers’ (FOIL) motor sector focus team and technical lead for motor at Weightmans.
He said: “Rentable e-scooters within the trial are required to be insured by the provider. Private e-scooters, however, remain illegal for use on roads and public places.
”Brokers must beware of advising that e-scooters might be covered by household policies and the like - they are motor vehicles and need to comply with all the legal requirements of other motor vehicles, including insurance requirements. Uninsured users are liable to both prosecution and uninsured civil liability.
”One of the key objectives of the e-scooter trials going on across London and the UK is an assessment of the propensity and severity of accidents.
”Until the trial results and government policy are set out, brokers looking to forecast the risk their clients might face, perhaps either through personal or commercial use, could face a difficult time. Until the regulatory framework for e-scooters is known, crystal ball gazing is to be avoided.”
Revising Vnuk
A further consideration for e-scooters moving forward is the UK government’s plans around the European Union’s Vnuk ruling, which extends the requirement for mandatory motor insurance to be required on private as well as public land.
The ruling therefore broadens the scope of vehicles that need to be insured to include ride-on lawnmowers, golf buggies and quad bikes, for example.
In February 2021, however, the Department for Transport confirmed that it did not plan to implement Vnuk into UK law following Brexit.
Speaking about the repercussions on the insurance industry of the Vnuk ruling being reversed, Kinley said: “It brings UK motor insurance law right back to where we thought it was before the Vnuk decision.
“In crude terms, it means that road vehicles need to be covered by compulsory cover on roads and public places - away from roads and public places you don’t need compulsory cover.
”It might be a good idea to have voluntary cover for things like tractors, construction kits, mining vehicles. Obviously, there are risks there.
“The other repercussion is in motor sports. The decision effectively brought any motor sport vehicle within the scope of compulsory insurance.”
Kinley added that there may be discrepancies for UK drivers who wish to use their vehicles abroad too.
“Assuming that UK law still provides cover for using your motor vehicle in another country, we could have a slightly odd position that if you use a vehicle on private land in the UK, you do not have any compulsory cover, but if you go to France and rent a house and drive across the road to the private driveway of the house, you would still be covered under French law,” he said.
Has the UK seen any e-scooter claims?
In December 2020, Jordan jumped a red light and almost collided with an unmarked police car. Magistrate Peter Redding ordered Jordan to carry out 40 hours of community service - the Isle of Wight police stated that the “use of e-scooters while intoxicated would not be tolerated”.
Speaking about the incident, Alistair Kinley, director of policy and government affairs at law firm BLM, said it “would have significant implications for Jordan should she apply for motor insurance after her two-year ban expires”.
He added: “She’ll have to disclose the conviction and the sentence, which will inevitably affect the cost and availability of cover.”
Meanwhile in July 2019, two incidents involving electric scooters sparked a debate on whether insurance should be made compulsory for e-scooters.
YouTube star Emily Hartridge died after being hit by a lorry while riding an electric scooter. In a separate incident, a 14-year-old boy was reported to be fighting for his life after crashing his e-scooter into a bus stop.
E-scooters, the colloquial name for a two-wheeled electric powered scooter, can exceed 30mph - it is currently illegal to ride them on public roads and pavements in the UK. Insurance is not compulsory. The vehicles can only be ridden on private land, with the landowner’s permission.
In 2000, a court ruled that a Go-Ped scooter, which runs on petrol, counted as a motor vehicle - its rider was convicted for not having insurance or wearing a helmet after running a red light.
Which insurtechs are involved in the government e-scooter trials?
There are three operators - Dott, Lime and TIER who are all involved in the in the year-long trial in the boroughs of Ealing, Canary Wharf, Hammersmith, Fulham, Kensington and Chelsea and Richmond upon Thames.
A City of London Corporation spokesperson has also confirmed: “The City Corporation will join the London rental e-scooter trial from 5 July.
“We are committed to investigating how e-scooters can play a role in supporting a shift to sustainable travel to compliment walking, cycling and public transport options in the Square Mile.”
Zego has been heavily involved in the trial - it partnered with Dott in July 2019 to insure its fleet of shared e-scooters across France, Belgium and Italy. The insurtech has also partnered with Ginger, TIER and Voi.
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