3. March 2022
China has a higher acceptance towards AV & related services
3
Acceptance towards Autonomous Driving (AD) Technology
Will you consider purchasing vehicle with AD function in the next 5-10 years?
• Users expect the autonomous driving (AD)
technology to be comfortable, customized.
• Two-thirds of respondents are willing to use AV
(including AD functions), 75% of whom are willing
to pay an additional 5-20% per trip for an
autonomous driving function.
Acceptance towards AV Ride-Sharing
Will you consider using Robotaxi in the next 5-10 years?
33%
57%
9%
1%
13%
31% 29% 27%
9%
31% 29% 31%
Yes Likely Unlikely No
CHN USA GER
38%
52%
9%
1%
18%
35%
25%
22%
14%
35%
26% 25%
Yes Likely Unlikely No
CHN USA GER
3
regions
> 20
questions
> 3,000
respondents
Data source: PwC strategy Data source: PwC strategy
4. March 2022
Chinese government highly supports autonomous driving development
City/
province
Policy
Beijing
Beijing intelligent connected vehicle innovation
development action plan (2019 - 2022)
Shanghai
Shanghai smart manufacturing action plan (2019-
2021)
Shenzhen
Measures of Shenzhen on supporting the
development of intelligent connected vehicles
Guangdong
Rules of Guangdong province for the management
of intelligent connected vehicles road test (trial)
Jiangsu
Jiangsu province action plan to promote the
development of telematics industry (2019-2021)
Zhejiang
Zhejiang province action plan for high-quality
development of automotive industry (2019-2022)
Henan
Henan province three-year action plan for the
development of new energy and net-linked
vehicles (2018-2020)
Chongqing
Chongqing accelerating the development of new
energy and smart connected vehicle industry
several policy measures (2018-2022)
Sichuan
Chengdu intelligent connected vehicle industry
development trail program (2019-2022)
Road Test
• Test on public
roads
• Pilot in certain
areas of cities
(public road,
with safety
driver)
Proof of
concept
• More regular trails
are conducted in
some cities
Draft laws
• National Basic
Traffic
Management
Law is expected
to be enacted
(draft currently
under review)
Legal system
• National Basic
Traffic
Management
Law adjustment
is accomplished
Commercialisation
• Grant L4 robo-taxi
official operation
(without safety driver)
Test on public
roads
• 27 cities allow
L3/L4 cars to be
tested on public
roads
• Over 750 road
test licences are
issued
Pilot service
• Guangzhou:
Pony, WeRide
• Beijing: Baidu
• Shanghai: DiDi
• Suzhou:
Momenta
Ministry of
Industry and
Information
Technology:
action plan
More scenarios:
airports, ports, BRT
(Bus Rapid Transit)
road, industrial parks,
etc.
More cities: facilitate
autonomous driving
pilot services in
Shanghai, Beijing,
Hebei, Chongqing,
Wuxi, Hangzhou,
Wuhan, Changchun,
Guangzhou and
Changsha
ACLA (All China Lawyers Association)
is reviewing legislative amendments
Currently, basic laws such as the Road Traffic
Safety Act are incompatible with autonomous
driving and are currently under discussion in the
industry
Multiple departments: smart car
innovation development strategy
By 2025, Chinese smart car regulations and
standards should be in basic formation
Chief scientist of
National Innovation
Center of
Intelligent and
Connected Vehicles:
intelligent
connected vehicle
technology 2.0
By 2025, High
Automation (HA) level
intelligent connected
car will be commercially
available in limited areas
and specific conditions
4
2019-2020
2021
2022-2023
2024-2025
2026-2030
Source: Literature research, PwC Strategy & Analysis
5. March 2022
Challenges for autonomous
vehicle insurance innovation and
Swiss Re solution for Baidu AVP
(Apollo Valet Parking)
5
6. March 2022
From an insurer’s standpoint, the variety of risks present challenges for Autonomous
Vehicle (AV) insurance design
6
Risk
difference
between
traditional
vehicles &
AVs
Risk accumulation
Dependence on Internet connection
increases when AV level heightens, which
contributes to accumulated risks and brings
challenges in risk diversification.
Lack of historical data
It is still not proven whether AVs are on
average safer (in terms of frequency and
severity of accidents) than human driven
vehicles.
Digital & cyber risk
New cyber risks were introduced by using
digital devices and algorithms, including
risks arising from malicious attack, system
failure, algorithm defect, operational
mistake.
Effective risk management
Autonomous vehicles need timely, effective
and targeted risk management to reduce
their risk and improve their insurability.
Transfer of responsible party
Responsible party shift from driver to the AV itself (in case of software
and hardware failure). As the level of automation increases, the
manufacturer is subject to a higher proportion of liability.
7. March 2022
Considering the current status, challenges in all the phases of insurance innovation
need to be solved by insurers and tech companies together
7
Underwriting Policy management Claim handling
Current
status
• Lack of unified standards and
definition of AV function and level
• Lack of safety standards for AVs
• Various and complex application
scenarios; vehicle type and
operation condition differ
• Implicit classification of liability
(i.e., the boundaries of
responsibility between humans
and AD systems) not clearly
defined
• Lack of historical data
• Incomplete risk management
system
Challenges
• Every case and need of AV
providers and/or primary insurers
is unique. Need to evaluate
respectively.
• Need to design different
products for different conditions
• Difficulty in developing new
products due to ambiguous needs
(i.e., many businesses fail to clearly
articulate product needs from an
insurance perspective)
• Lack of pricing basis
• General loss adjusters from primary
insurers lack experience in handling
cyber risk
• No standards established for cyber
risk related claims
8. March 2022
Baidu as an autonomous driving tech giant in China, promoted Apollo Valet Parking
(AVP) solution to market, focusing on two urban parking scenarios
8
H-AVP: Home - Apollo Valet Parking
• focus on private car parks
• demonstrate H-AVP once, H-AVP remembers
the specific car park and releases drivers from
daily parking thereafter
P-AVP: Public - Apollo Valet Parking
• focus on public car park, covering main public
parking lots in Beijing, Shanghai, Shenzhen,
etc.
• HD-Map and path planning release drivers from
parking
Pictures from Apollo Official Website.
9. March 2022
Risk factor detection Insurance product design & pricing Product launch & Portfolio Mgmt. General underwriting guideline
Understand the
autonomous function and
identify the potential risks.
Utilise Swiss Re risk insights on autonomous
driving technology, design tailored insurance
product with convincing pricing.
Launch new insurance products to market,
collect market feedback and optimise the
product portfolio.
Develop risk insights and build general
underwriting guidelines to meet dynamic
market requirements covering more front-
edge autonomous functions applied in
more complicated scenarios.
Based on Swiss Re’s risk insights, Swiss Re and Baidu launched insurance products for
AVP to market, creating a new business model between reinsurer(s) and tech giant(s)
9
News release about Swiss Re & Baidu
partnership:
Swiss Re and Chinese tech giant
Baidu partner to advance the
ecosystem of autonomous driving
with risk expertise and insurance
innovation | Swiss Re