No, you need to install it manually.
There are three version of the zwave binding: stable, snapshot, development.
If you are on a stable openHAB2 runtime version, you cannot update to the snapshot or development version of the zwave binding (and it does not make sense because changes in the binding do not match the openHAB runtime)
If you are on a snapshot openHAB runtime, you can update the snapshot zwave binding with simply uninstalling it through PaperUI, wait a minute, install it again.
If you are on a snapshot openHAB runtime, you can update to the zwave development version of the binding by uninstalling the snapshot zwave binding, download the development version of the zwave binding and drop it into the addons folder. In this case you may also need to install the serial transport dependency manually through the console.
I know it gets complicated sometimes, but all this is necessary to not break the system for users using openHAB stable and at the same time implement new features/fixes for users on unstable openHAB2 runtime versions so they can test it (for the benefit of the next stable release).