WHAT IS TESLA CAR INSURANCE?
Tesla Car Insurance is the next buzzword after the launching of Tesla cars in India 2021 is fast in news now.
Also, the car-savvy are eagerly waiting for the launching of the Tesla cars in India.
Tesla registered its Indian company as Tesla Motors India and Energy Private Ltd. with a corporate office at Bangaluru, Karnataka a hub of all Global technology companies.
Tesla Motors, Amsterdam, The Netherland is the parent company of Tesla Motors India and Energy Private Ltd.
Due to tax-friendly jurisdiction, Tesla has chosen the Netherland route for entering into India.
As per experts, this corporate structure in India would offer Tesla tax benefits related to capital gains and dividend payments.
Tesla expected to have its headquarter in India’s financial capital Mumbai along with Delhi and Bangaluru.
As of now, Tesla plans to start by importing and selling its Model 3 electric sedan in India first.
The other global Tesla’s model consists of the S sedan, the Model X SUV, the Model 3 compact model, and the Model Y compact crossover.
Tesla is also in talks with major Indian players for Electric vehicle(EV) charging infrastructure.
TECHNOLOGY USED IN TESLA CARS
Tesla cars come standard with advanced hardware capable of providing Autopilot features, and full self-driving capabilities—through software updates designed to improve functionality over time.
Tesla’s Autopilot AI team drives the future of autonomy of current and new generations of vehicles.
Autopilot allows the car to steer, accelerate, and brake within its lane.
It uses the car’s eight cameras, 12 ultrasonic sensors, radar, and an onboard computer to read lane paint on the road and detect surrounding cars.
WHAT IS TESLA INSURANCE?
As Tesla cars are of high-tech nature with automated driving technology, one needs to be careful while choosing insurance coverage for Tesla.
Here take a look at Tesla insurance presently available in the US market.
In 2019, Tesla as a licensed broker introduced Insurance in California with State National Insurance company as insurer.
Tesla is offering auto insurance to its California buyers only.
The coverage is available for owners of Tesla’s Model S, Model X, Model 3, Model Y, and Roadster models.
Tesla offers its own insurance program that gives coverage specific to the state-of-the-art electric vehicle.
This coverage can again supplement with additional coverage over and above base coverage.
One needs to be cautious as Tesla Insurance is not covering your car if you use it for ride-sharing. However, Tesla is working on a separate insurance policy for commercial vehicles.
DISCOUNT IN TESLA INSURANCE
According to Business Insider, Tesla’s insurance plans to offer a 20 percent to 35 percent discount to drivers who are having good driving records and had not been penalized within the last three to five years.
They also hope to include other commonly available discounts such as:
• Multi-policy discount
• Loyalty discount
• Group rate
• Mature driver improvement course discount
• Anti-theft device discount
TESLA’S AUTOMATION INSURANCE PACKAGES
All Tesla insurance packages come with a Vehicle Automation Package that includes the following:
1. Autonomous vehicle liability: It’s most unique coverage, autonomous vehicle coverage is not available through other car insurers. Tesla Insurance will provide liability coverage for property damage or bodily injury if your car gets in an accident while operating in autonomous vehicle mode.
2. Cyber identity fraud expense: This covers you against digital identity fraud. This coverage pays up to $15,000 in digital identity fraud losses per occurrence and up to $30,000 per period if your information is compromised.
3. Wall charger coverage: This covers your manufacturer-issued electrical power charger if it gets damaged or lost. This coverage is limited to $3000 and doesn’t cover damage that you caused or a manufacturer defect.
4. Electronic key replacement: This covers the loss of your electronic car keys, up to $500 for two claims per policy period.
5. Loan/lease payoff: This protects you in case your car is stolen or totally damaged. It will pay the balance of your car lease or loan, based on the value of your car. It is also known as ‘Gap Insurance’. But to qualify for gap insurance, you will need to have collision and comprehensive insurance on your car insurance policy.
INSURANCE COVERAGE AVAILABLE FOR TESLA
A. Liability insurance: Liability insurance covers you against injury caused to another person or damage to their property. Tesla’s are less dangerous than other vehicles, so liability coverage can be limited up to as per law and can add a little extra to cover medical bills and possible lawsuits that may result from an accident.
B. Personal injury protection: It provides coverage against medical expenses in case of an accident.
C. Collision insurance: It covers any damage to your Tesla as a result of any collision or accident.
D. Comprehensive insurance: It covers damage caused to Tesla by something other than another vehicle. It can also extend to cover the theft of cars.
Tesla uses Car data and Driver data to underwrite its Insurance policy.“Telematics is going to be an important driver of enhanced underwriting in this space as all of the major insurers now have Telematics products.” Robert Le, an analyst at PitchBook Mobility, told Business Insider.
IS TESLA INSURANCE EXPENSIVE TO OTHER INSURANCE, WHY?
Tesla is made out of expensive parts, contributing to their base cost.
The repair cost of Tesla models is also higher due to the cars’ aluminum bodies, which are much more expensive than those made with traditional materials.
In case if you damage a plastic or steel part on your sedan, an auto body shop can fix it for relatively little cost. The same isn’t true for aluminum body parts.
All of those excessive repair costs lead to higher insurance premiums, which again come back to owners in the form of higher Tesla car insurance prices.
TESLA MODEL 3 INSURANCE COST IN THE U.S.
Tesla Model 3 insurance costs an average of $2,215 per year, or about $185 a month, which is $315 more than the average car insurance rate in the U.S.
But rates vary widely from one insurer to the next. Among the five largest car insurance companies in the U.S., price differences for Tesla car insurance can be more than $1,000 a year.
Tesla Insurance depends on the model of your car. For instance, GEICO Insurance currently offers the cheapest rates for the Tesla Model 3.
However, for the Tesla Model X, Progressive has the cheapest rates, according to the Zebra.
These are the top nine cheapest insurance companies for Tesla:
1. Progressive – $2363
2. AAA Norcal – $2736
3. Tesla Insurance – $3315
4. State Farm – $3995
5. GEICO – $4181
6. Farmers – $4463
7. Allstate – $5314
8. AAA Socal – $6862
9. Mercury – $7625
FUTURE OF AUTOMATED CAR INSURANCE AND CHALLENGES-CLOSE LOOK IN INDIAN PERSPECTIVE
Presently, Tesla cars are not on India’s road. But a few days ago Tesla Model 3 was spotted testing in Pune.
So, there can not say more right now about Insurance options for Tesla cars in India.
Tesla cars are high-end cars that use automated driving technology i.e. Self- driving technology.
Which again have their own challenges and associated risks.
Like in the US market, the third-party liability coverage is flexible and limits can be lower down whereas in India the Liability cover (Third-party Insurance cover) is mandatory with pre-decided limits.
Automated Driving technology also demands the inclusion of coverages for risks associated with Cyber Insurance such as Cyberattack liability, Data restoration expenses, Cyber extension or Crisis Management.
With automated driving technology, the risks of an accident cannot be completely removed, as the events are not always predictable and the automated systems can fail.
So it again demands the inclusion of Product liability coverage in Insurance cover from the Manufacture or supplier side.
In such a scenario, the onus will immediately shift on the manufacturer to prove it was not responsible for the accident. This again results in an increase in the number of vehicle courts cases.
On the other hand, if automated vehicles prove to be safer and the technology behind them becomes cheaper, the liability risks will reduce and so as to premium also.
The billion-dollar Motor Insurance industry will drastically shrink. Yes, the time for this might be the next 10 years or more.
But it will certainly open new doors for exploring innovative products, solutions for monoline/regional insurers, tools for customer retention, and more. It’s just a matter of timing.
Presently Tesla Insurance is operating in California as a Licensed broker. Whether it will also operate in India for its Tesla cars?
There are so many questions, which are emerging with the advent of Tesla cars in India. and these all will be answered with the launch of Tesla cars in India soon?
Is India ready for Automated Driving(self-driving) Cars?