Police say the bomb which Syrian asylum seeker Emad Al-Swealmeen was carrying on Sunday contained ball bearings and may have detonated as a result of the car he was in suddenly braking.
Al-Swealmeen, 32, was killed when the bomb exploded outside Liverpool Women’s Hospital and engulfed the taxi in flames.
Russ Jackson, Head of Counter Terrorism Police North West, said: "It was made using homemade explosive and had ball bearings attached to it which would have acted as shrapnel. Had it detonated in different circumstances we believe it would have caused significant injury or death.”
He added: "We still do not know how or why the device exploded when it did, but we are not discounting it being completely unintentional, and it is a possibility that the movement of the vehicle or its stopping caused the ignition."
Mr Jackson said detectives are trying to trace where and when al-Swealmeen bought the ingredients for the bomb and say he appears to have used several aliases to purchase them over a number of months.
"We are confident, however, that in time we will get a full picture of what purchases were made and how, and if anyone else was involved or knew what al-Swealmeen was up to," said Mr Jackson.
Several people were arrested and then released earlier this week and police appear to be working on the basis that al-Swealmeen was a "lone wolf" attacker.
Earlier this week it was reported he had converted to Christianity but was also suffering from mental health issues.