Drivers of fully automated vehicles should not be held responsible for accidents that occur while the technology is operational, the Association of British Insurers (ABI) has said.
In a submission to the Law Commission, which is helping decide how the UK will incorporate rules currently being decided internationally about autonomous vehicles, the ABI argues it would be unfair to expect the driver to intervene if the on-board systems got something wrong or were unable to prevent an accident.
It says this means manufacturers must not be allowed to have their vehicles recognised as autonomous when a driver might still be expected to act in an emergency.
According to the ABI, any process that triggers the vehicle handing control back to the person behind the wheel must be clearly signposted, and give the driver enough time to regain control safely.
It says that until a vehicle can handle emergency scenarios without driver intervention, it can only be considered to offer advanced driver assistance. That means drivers remain fully responsible for the car, and must be ready to take back control at any moment.
ABI motor insurance policy adviser Laurenz Gerger said: "There will come a point when the drivers of today are effectively just passengers of a vehicle driving itself, and at that stage we want motorists to be reassured they can't be held liable for an error made by a vehicle or a piece of on-board technology.
"Standards being set internationally, and the way they are adopted in the UK, need to enforce strict requirements to ensure vehicles aren't rushed onto the roads under the badge of autonomous when in fact they may still need human intervention at short notice.
"Fully autonomous vehicles have the potential to radically improve road safety and insurers are heavily involved in the trials taking place around the country.
"A safe transition to automated driving requires clear definitions to help consumers understand their own and their vehicles' responsibilities, and data must be available in the event of an accident to help insurers and the authorities understand what went wrong."
The ABI's submission has been made jointly with motor industry body Thatcham Research, which has previously warned of the risks of manufacturers overselling driver assistance systems, because of their potential to lull motorists into a false sense of security.
Thatcham director of research Matthew Avery said: "The life-saving potential of fully automated vehicles is clear, but it is important their introduction onto the UK's roads is handled carefully to guard against serious accidents which could potentially undermine public trust in this new technology.
"This also means reassuring the public that when the time comes, they will not find themselves being held liable for the actions of a truly autonomous vehicle.