E-Scooters: an eco-transport solution or accident waiting to happen?
Last week the Department for Transport announced that trials of rental e-scooters could begin from 4 July. E-scooters have been on the Government's agenda for some time, forming part of the Future of mobility: urban strategy, launched in March 2019; but much like the situation with remote hearings and the online court, the Covid-19 crisis has expedited the issue as the public grapple with a gradual return to work alongside concerns with using public transport.
There are a great many barriers to a successful integration, not least the transport infrastructure of the UK, with its limited cycle lanes and smart routes anywhere outside London. Issues abound as to how e-scooters should be regulated, and the Government began examining those issues in more detail in March in a call for evidence on micromobility vehicles as part of its Future of transport regulatory review. However, in May, in response to the Covid-19 pandemic, the Government announced it was bringing forward the trials of rental e-scooters in England, Scotland and Wales, to support plans for a "green restart of local transport", and issued a 2-week consultation seeking views on the proposed regulation of the trials.
In this article we look at some of the key issues surrounding e-scooters and the potential opportunities and risks for the insurance industry.
Definition of an e-scooter: current position
In its response to the snap consultation in May, the Department for Transport has said the definition of an e-scooter will incorporate the following elements.
'Electric scooter' means a motor vehicle that:
is fitted with no motor other than an electric motor with a maximum continuous power rating of 500W and is not fitted with pedals that are capable of propelling the vehicle
is designed to carry no more than one person
has a maximum speed not exceeding 15.5mph
has two wheels, one front and one rear, aligned along the direction of travel
has a mass including the battery, but excluding the rider, not exceeding 55kg
has means of directional control via the use of handlebars that are mechanically linked to the steered wheel
has means of controlling the speed via hand controls and whose power control defaults to the ‘off’ position
This definition differs to the one proposed in the consultation by:
increasing the weight limit to 55kg, to allow for designs with heavier batteries
introducing a higher power limit of 500W, to help e-scooters climb hills and inclines
allowing a seated variation of e-scooters, to benefit those with disabilities or those less able to use a standing version
increasing the maximum speed to 15.5mph from the initial proposal of 12.5mph. This, the Government says, makes the limit consistent with e-bikes, is in line with e-scooter rules in other countries and helps to avoid too many differential speeds with other road users.
Although this is the DfT's definition at the moment, this is likely to change following the upcoming trial. Already e-scooters can be separated into two groups - those with speeds up to the 12.5mph definition (or 15.5mph if the trials are a success) and those over, some being capable of up to 30mph (although likely to be treated more as a moped going forward). The first bracket of e-scooter are a common sight in cities in Europe and Worldwide, often hired through rental schemes rather than owned, making the insurance position more difficult but also perhaps open to a new type of solution. They can cost anything from £100 for a very basic model up to £1,500 plus at the luxury end of the market.
The current legal position in the UK
E-scooters are classed as a 'powered transporter' and fall within the definition of a "motor vehicle" under the Road Traffic Act 1988. Whilst in time the Government "may look to amend the law to treat e-scooters more like electrically assisted pedal cycles (EAPCs)", for the time being e-scooters will continue to be classed as "motor vehicles". This means that currently they are covered by the same laws and regulations that apply to all motor vehicles.
For the purpose of the trials though, The Electric Scooter Trials and Traffic Signs (Coronavirus) Regulations and General Directions 2020 make a number of amendments to various regulations "to remove or relax requirements for e-scooters being used in a trial, in a way which is proportionate to the vehicle type, to enable trials to take place on public roads." (See Explanatory Memorandum). Those amendments have the effect of:
Allowing anyone with a full or provisional driving licence to use a trial e-scooter
Not requiring the mandatory use of a helmet, though the wearing of a cycle helmet is recommended
Allowing the use of e-scooters on the road (but not motorways) and in cycle lanes and tracks
Exempting trial e-scooters from vehicle registration and licensing
The rules are not changing for e-scooters that are not used as part of the trials, they will remain illegal on the road, in cycle lanes and tracks, and on pavements, as outlined in the Government's powered transporters guidance.
To date though, this guidance has not stopped UK residents using them on roads and pavements as they are easily available for purchase, and they rely on the fact that there is either confusion or at least a reluctance to enforce the rules. This is nothing new, it is not legal to ride a push-bike on the pavement but it has become so commonplace that a layperson asked on the street would probably not know.
As e-scooters remain classed as motor vehicles, the requirement to have insurance continues to apply. For the trial, the rental operators will need to have appropriate insurance in place providing a minimum of third party cover.
There is still an ongoing debate about the scope of the Motor Insurance Directive following Vnuk v Zavarovalnica Trigalev (C-162/13) confirming the principle that all mechanically propelled vehicles require motor insurance. In May 2018 the European Commission presented proposals to amend the Directive and adopt the wider definition of "use of a vehicle" as set out in Vnuk. When the European Parliament considered the proposal in 2019, they contended that the directive should not cover electronic bicycles, Segways and electric scooters since they are smaller and are therefore less likely to cause significant damage to persons or property. Negotiations between the European Institutions on the scope of the Directive are ongoing, but of course the added factor here is the extent to which EU law will remain applicable in any event after the Brexit transition period which ends on 31 December 2020.
Safety, and experience abroad
Sadly we had our first UK fatality last July when Emily Hartridge, a well-known You Tube vlogger, was killed in London colliding with a lorry on a roundabout.
Safety is one of the reasons why the development of e-scooters in the UK was delayed, but the Covid crisis has advanced the potential integration of e-scooters quicker than anyone would have imagined. Currently there are no significant safeguards in terms of safety features that are required and towards the cheaper end of the market one wonders if the product is fit for purpose. Certainly, some form of design standards will have to be set and will need to be monitored. There are also no mandatory training requirements for use even under a provisional licence which is perhaps a further concern.
Anyone who has been to a major city in mainland Europe over the last few years will have noticed the considerable growth in the use of e-scooters. There is no uniform view on how/where e-scooters should be ridden and the rules surrounding use differ across the EU and indeed the United States.
There has been push back in Spain due to three fatalities in 2018, then a 92 year old woman was hit by a scooter and died in 2019. This led to new legislation in the latter part of 2019 to make use on pavements illegal with fines of up to 500 euros plus the same for mobile phone use. A maximum speed of 25kph (which equates to 15.5mph) has been set, with insurance and protective helmets recommended but not mandatory.
In Belgium it is legal to ride scooters up to 25kph on roads without protective gear and no insurance is required by law. In France, the position changed in October 2019 and banned use on pavements, and from July of this year capped the top speed at 25kph. Unlike Spain, helmets and high visibility clothing have been made mandatory. There were five recorded deaths in France in 2017. In Austria vehicles up to 25kph fall under the same under the law as pushbikes.
The law in the United States differs between states. California for example has strict regulations – riders must be over 16, have a driving licence, wear a helmet and follow the same rules that cars do. Contrast this to Washington State where they are not considered motor vehicles, there are no safety requirements and e-scooters are allowed on the pavement.
A lot of observers are in favour of compulsory use of crash helmets, unsurprisingly when many of the reported injuries and fatalities in the US have been head injuries, and the cost to the industry in terms of higher value claims would be disproportionate. Due to the ‘standing’ position of the rider on an e-scooter, riders suffer higher rates of head injury as they are likely to be thrown forward quicker. This is taken from perhaps the most comprehensive research on the issue carried out in Denmark between 2016 and 2019 Injury from electric scooters in Copenhagen: a retrospective cohort study. The same study found that in injuries sustained in the faster group of e-scooters above 15mph, 20.5% of injuries sustained by riders were head injuries. With the slower, manual scooters the figure was only 10.5%, so quite a marked difference. DWF's Ian Slater considers the potential for serious injury arising out of the use of e-scooters in his blog post this week.
Across the globe the manner in which e-scooters are dealt with in legal terms is only consistent in its inconsistency!
What does the UK insurance market make of the issue?
Whilst an undoubted opportunity exists for insurance covering e-scooters there is also risk and it seems likely that in order to facilitate greater use, the Government will not insist on minimum levels of insurance cover. That could see insurers potentially being hit in the pocket with claims stemming from e-scooters without the benefit of taking premiums.
In May, a FOIL virtual roundtable was held with participants including a mix of insurers, defendant solicitors, the ABI and MIB. Whilst there was no unanimity, the general view was that e-scooters should not be allowed on pavements but should be permitted on cycle paths and roads. Then the question arose of which roads – should they be limited to single carriageways up to 30mph by way of example?
The question of insurance brought disagreement – some felt there should be compulsory insurance including cover for third party liabilities. Others felt this too much of a barrier to change although the overriding view was that some form of insurance was necessary. Most thought that the insurance required should not be specifically motor. This could potentially be an opportunity for new types of authorised insurers to provide policies - innovation in the market was called for to find a solution. Could cover be in place per household rather than by vehicle? If hired through an app, could part of the fee be a small sum to cover insurance?
It looks very much like there will be a two-tier market with firstly e-scooters up to say 15mph, and then different rules for those above up to around 30mph with the latter group being treated more like mopeds.
The upcoming trial is intended to be for hired e-scooters, using a rental scheme with insurance required and a driving licence needed. They will be allowed within certain boundary zones, on roads as well as cycle paths. The outcome of the trials will be interesting but the Government very much wants this to succeed and concerns over insurance, safety and logistics may to some extent be outweighed by a positive outcome in terms of work and social mobility, and the environment.
After the trials have taken place in a safe and controlled way, the Department of Transport intend to gather robust meaningful data. It is highly likely that the conditions imposed after the trial will be different, and if, as the Government seems to be leaning towards, e-scooters are treated more like EAPCs, the requirement for compulsory insurance to cover third party risks may well be missing as the Government wants to encourage as much use as possible.
Impact on the claims landscape
One point that hasn’t been considered in detail yet is the effect of widespread use of e-scooters more generally on the claims landscape. Covid has seen a growth in cycling and this will most likely lead to a longer term increase in the number of cycling-related claims being made. The below graph taken from DfT data shows just how significant the rise in cycling has been since the crisis began – whilst this might not be mirrored exactly with e-scooters, they are likely to be very popular given the experience outside the UK.
Just as with cyclists and pedestrians, e-scooter riders are likely to be classed as vulnerable road users and exempt from parts of the whiplash reforms including the tariff.
The number of overall claims may fall but the severity of injuries, including head and psychological, may increase causing indemnity spends to rise. Credit hire of replacement e-scooters is likely to be lucrative, at least for a short period until insurers adapt. It is expected that the usual players will jump on the bandwagon. As ever credit hire costs are likely to be disproportionate to the cost of an e-scooter – but assuming there is no registration document or safety register, the absence of traceability does present a risk of fraudulent claims. There may also be increased claims to the MIB because of untraced riders if e-scooters are covered on a household policy or by a vehicle policy.
Although there are significant safety, regulatory and legal hurdles to surmount, the Government seems very much in favour of e-scooter use, which can be seen by the speed of the consultation launched and the trials brought forward. The trials are just that though – a first attempt to regulate what will, if forecasts are accurate, become a vital and significant part of the UK's transport infrastructure. The way the trials have been set up, with compulsory insurance and the requirement for vehicle licences to be held will possibly fall by the wayside to promote greater use. Of course, if there are significant numbers of serious injury claims then compulsory insurance and helmets become more likely scenarios. We can also expect any fatalities to be particularly newsworthy as we have seen with the tests around autonomous vehicles around the world.
Whilst the trials are just that and the Government have emphasised that they do not predict the outcome, it seems inevitable that they will be allowed on UK roads and cycle routes in some format on an ongoing basis. Without a system that will separate them from the larger vehicles on the road accidents might be serious and high profile. Improvements in both the transport infrastructure and the scooters themselves might well be needed to prevent a growth in serious injury claims.
For further information please contact, Will Balfry on 0151 907 3138 or at email@example.com, Nigel Teasdale, Head of Motor & Fraud on 07752 709114 or at firstname.lastname@example.org, or Marcus Davies at email@example.com
This information is intended as a general discussion surrounding the topics covered and is for guidance purposes only. It does not constitute legal advice and should not be regarded as a substitute for taking legal advice. DWF is not responsible for any activity undertaken based on this information.