Tesla insurance, the electric vehicle (EV) manufacturer’s in-house option for auto coverage, is a new product that’s just starting to gain traction. We at the Home Media reviews team wanted to learn whether Tesla insurance can stack up to the industry’s best car insurance providers, so we took an in-depth look at the company’s policies.
We compared the availability, coverage options, costs and customer service scores of Tesla insurance to determine how it ranks versus leading providers. We found that drivers aren’t always satisfied with Tesla insurance due to its relatively poor customer service standards and pricey plans for car coverage.
About Tesla Insurance
Tesla Insurance is one of the market’s newest providers, with Tesla CEO Elon Musk only announcing the program in 2019. Availability is currently limited, as drivers in only 11 states can pick up coverage from the company. Here’s where Tesla insurance is available as of September 2022:
- Arizona
- California
- Colorado
- Illinois
- Maryland
- Nevada
- Ohio
- Oregon
- Texas
- Utah
- Virginia
While Tesla Insurance is clearly designed with coverage for Tesla vehicles in mind, Tesla owners can insure their non-Tesla vehicles by adding the vehicles to their Tesla Insurance.
How Much Is Tesla Insurance?
Auto insurance for Tesla models tends to be pretty expensive, and rates will usually be higher than the national average of $1,730 per year for full coverage.
A 2017 report from the Highway Loss Data Institute (HLDI) concluded that Tesla owners were more likely than the average driver to get into an accident. Another HLDI study found that Tesla models are significantly more expensive to repair after collision and comprehensive claims.
Tesla Insurance Cost Factors
Monthly premiums change with any provider, but they’re particularly variable with Tesla insurance. The company employs an unusual method, setting its own insurance rates based on the factors below:
- Tesla model: More affordable cars like the Tesla Model Y are often cheaper to insure than higher-end ones like the Model X.
- Location: Rates will vary based on the state you live in, but they could also change within your state based on the presence and severity of risk factors.
- Miles driven: Those who put large numbers of miles on their vehicles will likely end up paying steeper rates for Tesla insurance.
- Deductible: Drivers who choose a low insurance deductible will pay higher monthly rates for car insurance. They’ll pay less upfront for auto repairs, though.
- Chosen coverage: Those who select more extensive coverage or have high limits on their Tesla insurance plans will likely be charged more. They’ll receive greater benefits if they have to file an auto claim, though, so it’s worth it for many Tesla drivers.
- Safety Score: There are five main components to the “Safety Score” calculated by Tesla. These factors are the number of forward collision warnings you receive per 1,000 miles, how many times Tesla’s Autopilot system has to be disengaged, and the number of times you exhibit hard braking, aggressive turning and unsafe following.
Tesla says it doesn’t use factors such as your age, gender, credit score and marital status when setting your rates. This is different from most providers and may appeal to certain drivers.
Tesla Safety Score
Tesla claims that it personalizes car insurance rates based on your driving behavior by using real-time monitoring through its app. The program, named the Safety Score, extends lower rates to drivers who practice good habits but will also penalize drivers with bad ones.
Driving behaviors to avoid include hard stops, speeding and using your phone while driving. Each month, the app issues a safety score that will affect your rate for the following month. While Tesla insurance pitched this as a revolutionary way to set rates, it’s more or less a typical telematics insurance program.
Note that the Tesla Safety Score and real-time monitoring aren’t currently available in California. Your rates may be calculated on more standard factors if you’re a Golden State resident.
Tesla Insurance Discounts
Tesla insurance lists a single savings opportunity on its website: a 12% discount for insuring more than one vehicle on your policy. There are also mentions online of an Autopilot discount that can reduce your rates if you’ve got a Tesla with a strong autonomous driving capacity.
While these were the only Tesla insurance discounts mentioned, it’s worth reaching out to an agent to make sure that there aren’t other potential savings. Many insurers give car insurance discounts for having a clean driving record and for having certain safety features in your vehicle.
Tesla Car Insurance Coverage
When it comes to coverage types, Tesla insurance is a relatively standard provider. You can choose either a minimum coverage plan that meets your state’s requirements or opt for a wide range of insurance products that can protect your Tesla.
Tesla Standard Coverage
Here’s a list of standard options offered by most insurers, and what they cover:
- Bodily injury liability insurance: Other parties’ medical expenses and lost wages if they’re injured in an accident that you’re found at fault for
- Property damage liability coverage: Damages to others’ vehicles and personal property resulting from an accident for which you are at fault
- Personal injury protection (PIP): Medical bills and lost wages for you and members of your party, regardless of who caused the collision
- Medical payments (MedPay): Medical expenses but not lost wages for you and your party no matter who is ruled at fault for an accident
- Uninsured motorist/underinsured motorist: Your injury and property claims if an at-fault driver doesn’t have sufficient coverage to pay for the damages they caused
Tesla Full Coverage
When shopping around, you may find people mentioning full coverage insurance. This refers to policies that include collision and comprehensive insurance in addition to state-mandated liability coverage. These full coverage plans include the following:
- Collision coverage: Covers damages to your own vehicle and personal property regardless of who caused an accident.
- Comprehensive coverage: Covers damages to your vehicle from sources other than car accidents. These could include fires, flooding and instances of theft or vandalism.
Tesla Additional Coverage Options
Tesla insurance offers a few additional coverages that can help you cover expenses related to your vehicle. Although we found these choices commonly mentioned by Tesla owners in our research of customer feedback, there’s no information online about the programs.
- Glass coverage: Covers the cost of repairing or replacing the glass in your Tesla.
- Roadside assistance: Covers the cost of your emergency roadside needs such as towing, fuel delivery and flat-tire help on top of standard insurance services.
- Rental car reimbursement: Covers the cost of a rental car if your Tesla is involved in an accident or heads to the shop for repairs.
- Gap insurance: Covers the difference between what you owe on a vehicle and what it’s worth in the event of a total loss.
Tesla Insurance Reviews
Since Tesla insurance hasn’t been around for long, it’s difficult to find customer reviews for it. Tesla is a much larger company, so it’s possible to look at overall reviews to understand how it treats its customers.
The Better Business Bureau (BBB), which rates companies on how they respond to customer complaints, gave Tesla a C- rating and has withheld accreditation. Customers on the BBB site give Tesla 1.2 out of 5.0 stars and the automaker has a relatively high number of complaints, even considering its size.
We noticed a few patterns in Tesla reviews regarding customer service. People who reported a positive experience with the company mention its technology and the user-friendliness of its app, while negative reviews focus on frustrations with representatives when filing claims.
Our team reached out to Tesla for comment on these reviews but has yet to receive a response.
Should I Get Tesla Insurance Elsewhere?
Note: All estimates are for full coverage insurance and based on the standardized profile of a 35-year-old driver with a clean driving record and good credit history unless stated otherwise.
Tesla insurance isn’t your only option for car coverage, and some third-party providers may offer more reasonable rates for coverage. Note that insurance rates from other companies will likely be impacted by your age, gender, credit score and other factors left out by Tesla.
Tesla Model 3 Auto Insurance Estimates
Among the providers in our study, the average estimate for third-party insurance on a 2022 Tesla Model 3 is $2,892 per year or $241 each month. USAA’s insurance offerings have the cheapest estimates on a Tesla Model 3 for each model year studied. However, this insurance option is only available to members of the military, veterans and their families.
Tesla Model Y Auto Insurance Estimates
The average third-party provider estimate for full coverage on a 2022 Tesla Model Y is $2,680 annually or $223 per month. USAA offers the lowest rate estimates for each model year, though Nationwide’s estimates are extremely similar.
Tesla Insurance: Conclusion
Owners may find cheaper rates from Tesla insurance than through other providers, but that’s not always guaranteed. People who enjoy the Tesla ecosystem will likely enjoy the experience offered through the company’s insurance program, so it may be worth a look.
The company’s approach may not be for everyone, however. Those who value personal customer service may find navigating the company’s nearly all-digital structure difficult and frustrating. Overall, Tesla insurance is worth a look for owners who’ve appreciated the company so far. For most other drivers, it’s unlikely to be their best option.
*Ratings are determined by our editorial review team. Learn more about our scoring methodology below.
Tesla Insurance: Recommended Alternatives
Tesla may be the best auto insurance provider for some, but even those people can benefit from shopping around. It’s a good idea to compare car insurance quotes online to learn who offers the best coverage at the most competitive rates.
State Farm: Editor’s Choice
State Farm is the nation’s largest insurer and it earned the top score in our 2022 auto insurance study. Our team found that the company offers an outstanding combination of coverage options, affordable rates and customer service. State Farm also features one of largest selections of discounts in the industry, making coverage even more affordable.
Keep reading: State Farm insurance review
Geico: Affordable for Most Drivers
Tesla Insurance: FAQ
Our Methodology
Because consumers rely on us to provide objective and accurate information, we created a comprehensive rating system to formulate our rankings of the best car insurance companies. We collected data on dozens of auto insurance providers to grade the companies on a wide range of ranking factors. The end result was an overall rating for each provider, with the insurers that scored the most points topping the list.
Here are the factors our ratings take into account:
- Cost (30% of total score): Auto insurance rate estimates generated by Quadrant Information Services and discount opportunities were both taken into consideration.
- Coverage (30% of total score): Companies that offer a variety of choices for insurance coverage are more likely to meet consumer needs.
- Reputation (15% of total score): Our research team considered market share, ratings from industry experts and years in business when giving this score.
- Availability (10% of total score): Auto insurance companies with greater state availability and few eligibility requirements scored highest in this category.
- Customer Experience (15% of total score): This score is based on volume of complaints reported by the NAIC and customer satisfaction ratings reported by J.D. Power. We also considered the responsiveness, friendliness and helpfulness of each insurance company’s customer service team based on our own shopper analysis.
*Data accurate at time of publication.
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