Tesla Insurance: What Is It & How Much Does It Cost?

You might assume that Tesla cars would be easy to insure because they are among the most secure vehicles on the roads today. Many Tesla owners believe the opposite. They can spend thousands more to insure their electric vehicle than they would for a gas-vehicle driver. The vehicle-specific rates include replacement and repair costs. These are much more expensive than other types of vehicles that have easily accessible parts.

There is now a company that writes policies for Tesla cars. It can help customers save between 20-30% on coverage. Tesla brought the company to your attention. Tesla Insurance Services was created by Elon Musk to offer Tesla vehicle owners more value. Who better to provide insurance for these owners than Elon Musk?

What Is Tesla Insurance?

Tesla had already launched its own insurance product for California. However, it did not use real-time driving data or Tesla’s safety score, which was the original goal.

Tesla was looking to improve its safety score system before expanding its insurance product into other markets. This is based on driving data from Tesla vehicles. It uses real-time data to determine whether you are a “good” driver. These include things such as the number of forward-collision warnings you receive, how hard you brake, aggressive turning, unsafe following distance, or if Autopilot disengages you.

Tesla launched its latest insurance product in October. It is based on Texas’ safety score.

According to the automaker, those who are rated “average” drivers on safety scores should be able to save 20% to 40% on their premiums compared to their competitors. Those with the highest safety scores could save 30% to 60%.

A comparison of the current premiums for Tesla drivers revealed that it was not clear whether Tesla’s product is cheaper. It seems that there is a greater difference in premiums for people who have a higher premium due to their age or gender. Tesla claims it does not use this method of premium calculation, unlike other insurance companies.

Tesla also assumes a 90 safety score when you first quote and start a policy. If you increase this score, the monthly premium price could drop quickly.

Tesla has released an example showing how your score can affect the premium.

Tesla has integrated all aspects of the product into its mobile app since the release, including ordering insurance, using the safety score, and paying and managing claims.

The insurance product was expanded by the company to Illinois in December and then to Arizona in January.

How Much Does Tesla Insurance Cost?

Tesla car insurance has been on the market only since 2019. It is therefore difficult to get a “big picture” idea of the cost of the insurance. Musk claims that Tesla Insurance is 20%-30% less expensive than similar insurance from other carriers.

To receive a quote for Tesla insurance, one must be a Tesla owner. However, our research shows that the standard coverage for a Model 3 is approximately $3,000 for a 30-year-old driver with a clean driving record. This is significantly less than the $4,500 average.

Remember that insurance costs can vary depending on many factors, including your marital status, age, driving record, and any past infractions.

It might seem that Teslas will have lower costs if they are as safe and reliable as they claim. Safety cars are more likely to cause fewer accidents which in turn means fewer claims. Tesla Insurance is expensive because of the high repair costs for cars that have been in accidents. This factor is used by insurance companies to determine the specific make and model rates.

For example, the body of a Tesla is made from aluminum rather than steel. Most repair shops don’t have the equipment to handle aluminum panels. The Teslas include a lot of expensive technology, which can be both hard to fix and costly. According to Tesla’s Texas filings, the company plans to offer parts at a reduced rate to certified repair shops — initially set at 15%. Customers will have access to the best mechanics to help them fix their EV.

Tesla Insurance has another silver lining: it recently announced that it would offer a discount of up to 70% on premiums for insurance that is based on the vehicle’s driving data. Tesla will calculate how significant the savings each customer will receive by using key performance indicators, such as how many times the lane departure warning has been triggered and the average following distance that a driver uses. This program is similar in concept to Progressive’s Snapshot program, which provides personalized insurance rates based on how policyholders drive.

Drivers have the option to opt out of this data-sharing discount, but they will be automatically placed in the worst category of eligible savings.

How Does Tesla Insurance Compare With Other Auto Insurance Companies?

Tesla Insurance Services provides standard insurance coverages to vehicle owners. You will also find the types of coverage you’ll find with any auto insurer. These include:

• Bodily Injury Liability: This coverage covers injuries that you cause to the driver or passengers of another car in an accident.
• Property Damage Liability: If you cause damage to another vehicle or its contents, you will be covered by property damage liability.
• Personal injury protection or medical payments: This covers the cost of personal injuries and losses to passengers or you.
• Collision – This will cover any damage to your vehicle that is caused by an accident covered by the policy.
• Comprehensive: Comprehensive insurance covers financial protection against damage due to non-accidental factors such as theft, weather damage, or animal contact.
• Uninsured/underinsured motorist: If you are hit by a driver with no insurance or not enough insurance to cover costs, this coverage kicks in.

Tesla offers special liability coverage called the Vehicle Automation Package for autonomous vehicles. This package offers insurance options such as autonomous vehicle liability, cyber ID theft, wall charger coverage, and electronic key replacement. These insurance options are exclusive to Tesla and not available with other insurers.

The optional coverages offered by Tesla mirror those available at other companies. These include roadside coverage which waives the deductible if the vehicle is totaled. Gap coverage covers your loan in the event that your car is stolen, totaled, or damaged.

Although Tesla isn’t known for offering discounts, there are many other options that can be used to lower your insurance costs. You can have more than one vehicle insured through the company. There are also loyalty discounts, good driver discounts, and driver education courses discounts. Customers who share their driving habits with the company may be eligible for the 70% discount.

Although Tesla’s pricing is not the most affordable, they cost about $1,000 less per year than larger carriers. Tesla vehicle owners can now add non-Tesla cars to their insurance policies.

Laura Adams, an insurance expert, advises you to get quotes from multiple companies before you make a decision. She advises that you shop around and compare rates from different insurers if you’re looking for Tesla insurance.

Is Tesla Insurance worth the investment?

It is worth getting a quote if you own a Tesla. You don’t have to stop there. Check out quotes from other companies as well, so you have several options. Tesla Insurance is not the most affordable option for all drivers. However, because it is specifically tailored for Tesla vehicles, you will be more likely to receive service from professionals who are familiar with these vehicles’ needs.

Even though Tesla’s network includes repair professionals, insurance through Tesla may be worth the extra cost, even though it is slightly more expensive than other national carriers. Tesla Insurance is more affordable if drivers share their data with the company. This is because Tesla’s 10-bucket driver classes are considered to be the safest.

It is unclear if Tesla’s insurance initiative will succeed and if it is truly the best insurance for Tesla cars. Critics claim that even though the company is familiar with its vehicles, it does not necessarily mean they are experts in the insurance business. Markel, an industry giant who has a lot of insurance knowledge, is Tesla’s partner.