Connected Vehicles and Credit Hire Recovery: Where Software Liability Leaves the Hire Period

A senior motor claims figure has warned that insurers are not ready for the liability and recovery questions coming from connected and autonomous vehicles. Here is what actually changes on a credit hire file when a car's software is arguably at fault, who the defendant still is, and why the hire period should not wait for the software fight to finish.

Recently a senior figure in motor claims put a marker down. Jess Scaife, director of technical motor and injury claims at Intact Insurance, told an Insurance Post Claims Club audience that insurers are not yet ready for the liability and recovery challenges coming from connected and autonomous vehicles.

That is an underwriting and recovery problem for insurers. It is also a credit hire problem, because if the industry has not worked out who ultimately pays when software is in the frame, that uncertainty can land on your file as a delayed liability decision and a fight over the hire period. So it is worth getting ahead of the question now, in plain terms, before it turns up on a live claim.

Connected is not the same as automated

The first thing to hold onto is a distinction the headlines tend to blur.

A connected vehicle is a normal car with software in it. Lane keeping, automatic braking, adaptive cruise, over-the-air updates, telematics. The driver is still driving. In law they are still the driver, and they are still responsible for the vehicle. Almost every car on the road today, and almost every car on your files, sits here.

An automated vehicle is different. It can legally drive itself for all or part of a journey, with no one required to be paying attention. That is a much smaller category, and in the UK it is still mostly ahead of us rather than behind us.

The reason this matters is that the two categories run on different liability rules. Get the category wrong and you can talk yourself out of a straightforward claim.

For a connected vehicle, the defendant has not moved

On a connected-vehicle crash, the law that applies is the law you already know. The at-fault driver was in control. If they were negligent, they are liable, and their motor insurer is who your client recovers from. Nothing about a lane-keep system or a software update changes that. Your client's entitlement to a like-for-like replacement vehicle in the meantime is unchanged too (we cover that ground for claimants in our not-at-fault guide).

"The software might have contributed" is not a new defendant. It is, at most, an evidential point between the at-fault driver's insurer and the manufacturer. That is a supply-chain argument those two parties can have on their own time. It does not sit between your client and their recovery, and it does not turn a routine non-fault claim into something exotic.

So when a defendant insurer starts talking about software as a reason the claim is suddenly complicated, the first question is simple. Was this a car a person was driving? If yes, you are on familiar ground.

Where the automated-vehicle regime actually bites

There is a genuine special regime, and it is worth knowing so you can spot when it does and does not apply.

The Automated and Electric Vehicles Act 2018 is on the statute book. Under it, where an accident is caused by an automated vehicle that is driving itself, the vehicle's own insurer is primarily liable to the injured party. The insurer pays first, then pursues whoever is actually responsible, including the manufacturer, under existing product liability law. That recovery down the chain is the insurer's problem, not the claimant's.

Two points keep this in proportion. First, that regime only applies to vehicles officially listed as automated, and in practice that list has not opened the floodgates. Second, the newer Automated Vehicles Act 2024 received Royal Assent in May 2024 but is not yet fully in force. A handful of provisions have commenced, and the government's own timetable now points to full implementation in the second half of 2027. So the self-driving liability framework is being built, not switched on.

The practical read for a handler in 2026 is this. If a case genuinely involves a self-driving vehicle, the insurer-pays-first rule may redirect who your client claims against. For the connected vehicles filling your caseload right now, it does not.

The real risk is to the hire period, not the defendant

Here is where connected-vehicle talk actually threatens a credit hire recovery. Not by changing who pays, but by giving a defendant insurer a fresh reason to go slow.

Picture it. A defendant accepts their driver was involved but says they are "investigating a possible software fault" and want liability parked while they look at the manufacturer. Weeks pass. The hire clock keeps running. Then the argument arrives that the period is unreasonable because it was allowed to drift. This is the same delay-and-attack playbook we cover in our note on intervention arguments, dressed up in new language.

Do not accept the premise. A dispute between two commercial parties about who ultimately foots the bill is not a reason to suspend your client's need for a vehicle. The reasonable hire period is governed by the same tests it always was. Need for hire, the repair timeline or total loss decision, the correct vehicle group, and mitigation. A software investigation upstream does not appear anywhere in that list. Rate is a separate question again, worked through the current GTA framework, which we walk through in our 1 July 2026 GTA rate review guide.

If anything, this is a reason to keep the file tighter than usual. Anchor the period to the physical facts. When the car went off the road, when it was inspected, when repair or total loss was confirmed, and what the client did to keep the period reasonable. Keep the period tied to the vehicle, not to the liability argument, and a later "it dragged on" challenge has nothing to stand on.

What to do on the file

None of this is theoretical once a defendant reaches for the software line. A few habits keep you covered.

1. Establish the vehicle category early. Connected car with a driver in control, or a genuine listed automated vehicle. That one fact decides which liability rules are in play.
2. Keep the defendant on the correct question. On a connected vehicle, their driver was driving. Any manufacturer recovery they want to pursue is their business and runs on their timetable, not your client's.
3. Protect the period from the dispute. Document need for hire, the repair or total loss timeline, and mitigation, so the reasonable period stands on the vehicle facts alone.
4. Do not let liability be "parked" indefinitely. A software investigation is not a liability defence. Press for a decision and keep the correspondence trail clean.

Connected and autonomous vehicles will change plenty about motor claims over the next few years. What they have not done, for the files on your desk today, is move the defendant or rewrite the reasonable period. Knowing that is what stops a software headline turning into a soft recovery.

The takeaway

Connected and autonomous vehicles are a real shift, and the recovery questions they raise for insurers are genuine. But for the credit hire files in front of you now, two things hold. The defendant on a connected-vehicle crash has not moved, and the reasonable hire period is still governed by the vehicle facts, not by whoever is arguing about software upstream. Handle the file on that basis and the software line loses its sting.

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