Tesla is about to launch a new insurance program in order to reduce costs for its owners and some details are starting to leak through a new partner behind the program.
For years now, Tesla has been increasingly more involved in building insurance products especially designed for its vehicles.
Two years ago, we published an exclusive report revealing that Tesla was working on a new car insurance program, which it started offering to its customers in Australia and Hong Kong. It has since expanded into several other markets including North America.
Last year, Tesla hired Alex Tsetsenekos, a former exec at Liberty Mutual, Tesla’s partner for InsureMyTesla in the US, and several other insurance companies, to lead what he described as a ‘Customer Centric Insurance Company’ for Tesla.
All those efforts are going to lead to Tesla launching an actual new insurance company to insure its vehicles, as confirmed by CEO Elon Musk last week.
The CEO said that they could launch the new service as soon as this month in the US.
Now we are starting to see evidence of this as Markel’s State National Insurance Company filed a document with the California Department of Insurance highlighting how they plan to front Tesla’s insurance program – via Reinsurancene.
According to the filling, Tesla will use State National’s services to manage the program and the policies will be backed by other unnamed risk-taking partners.
The document also shows that Tesla plans to offer different rates for drivers using its Autopilot technology. The filing specifically says that it will cover policies for “autos with Advanced Driver Assistance Systems (ADAS) in the State of California.”
Tesla has long been claiming that driving with Autopilot is safer than without and therefore, it is believed that the automaker will offer premium discounts to owners who have Autopilot as part of this new insurance program.
Furthermore, the filing describes how they plan to use the fact that Tesla’s vehicles are always connected and collecting data:
“State National further explains the program’s use of Tesla technology to provide benefits back to the insurance consumer, “The purpose of the product is to use Tesla’s proprietary technology to lower costs and improve the customer experience by embedded technology to support the underwriting, rating, claims, repair, and product manufacturing network, including direct data feeds with customer permission, when required, that eliminate frictional costs and inefficiencies inherent in traditional insurance processes.”
Between this and Autopilot, it is expected to that Tesla’s new program will lower the rates, which have been quite high on Tesla vehicles.
Using data from the Insurance Institute for Highway Safety, 24/7 Wall St. came up with a list of the 25 most expensive vehicles to insure based on insurance claim frequency and insurance cost per vehicle.
Tesla’s Model S topped it with an annual average insurance paid of $1,789.48 and annual collision insurance paid of $1310.40.
Last year, some insurance companies announced that they would increase their rates on Tesla’s vehicles based on a report that claimed “abnormally high claim frequencies” from Tesla owners.
Many Tesla owners have complained about quotes for Tesla vehicles higher than they are used to for vehicles of similar prices.
The filling didn’t indicate when Tesla could launch the program, but Musk recently said that it is about to have regulatory approval in several big states.
FTC: We use income earning auto affiliate links. More.