Electric Automaker Tesla is Offering Auto Insurance in California

author: FutureCar Staff    

Electric automaker Tesla Inc announced today that the company is offering its own car insurance policies to Tesla vehicle owners in California. Tesla said owners will receive up to 20% lower rates, and in some cases as much as 30% reduction in their current premiums in California.

Although Tesla Insurance is offering comprehensive coverage and claims management for residents of California initially, the automaker plans to expand to additional U.S. states in the future.

Tesla claims it is able to leverage the advanced technology, safety, and serviceability of its cars to provide vehicle insurance at a lower cost. Tesla said the discounts reflect the benefits of Tesla's active safety and advanced driver assistance systems (ADAS) that come standard on all new Tesla vehicles.

Tesla's insurance does not cover its vehicles for commercial use, so people that use their Teslas to work for Uber or another ride-hailing companies are exempt. However, the automaker said that it intends to roll out a commercial insurance policy in the future.

Tesla Insurance offers a convenient monthly payment with no hidden fees or charges, and Tesla said customers may cancel or change their Tesla Insurance policy at any time.

Tesla owners in California can purchase a policy in as little as one minute online at tesla.com/insurance. For new vehicle orders, customers can request a quote prior to delivery once a VIN has been assigned to their Tesla Account.

Tesla Insurance is currently available to all Model S, Model X, Model 3 and Roadster owners in California.

Data Collection for Insurance Purposes?

One of the ways insurance companies are able to offer less expensive insurance policies by offering usage-based policies. These policies use vehicle data, such as current speed, collected from the vehicle to offer safe drivers a bigger discount, while drivers that speed might pay a bit more.

Supposed you are driving 10 mph over the speed limit and hit a curb in your brand new Model 3. If you have Tesla's insurance and file a claim, the automaker can share the vehicle's precise speed and other vehicle data with the insurance company. If the driver was traveling above the speed limit, Tesla and the insurance company can find out just how fast you we're really going.

Tesla's website says the insurance does not record vehicle data, such as GPS or vehicle camera footage, when pricing insurance, however filing a claim may be a different story.

All Tesla vehicle are connected to the company's network and data from the vehicle, including the surround cameras, can be used to determine fault in the event of an accident. However we are not saying Tesla will do this, but its a possibility they can.

Driver's involved in an accident while using Tesla' semi-autonomous driving feature Autopilot could face additional scrutiny if filing a claim.

It appears as though Tesla's insurance policy may help protect the automaker from liability claims surrounding its Autopilot semi-autonomous driving feature. If a driver is involved in an accident, all of the vehicle data could be collected just like a block box in a aviation crash investigation, letting Tesla know exactly what happened.

We reached out to Tesla for clarification on its data collecting policies for the new insurance and will update this story once we hear back.

In the event of a insurance claim, let's hope that Tesla won't look for a way to reduce its liability by pouring through the vehicle data looking for a way to somehow blame the accident on the driver. 

However, Tesla customers can still select any third-party insurance product they prefer.

FutureCar Staff