- Tesla Motors announced it is setting up an insurance service in California to provide drivers with lower rates due to the safety features in the vehicles
Tesla Motors announced it is setting up an insurance service to provide drivers in California with lower rates due to the safety features built into the vehicles. Tesla CEO Elon Musk has been pushing for the idea that vehicle insurance rates for his company’s vehicles should be lowered as driver-assist and self-driving technology is becoming standard.
And Tesla is expecting the rates of the new plan to be reduced by as much as 20% than its rivals. The insurance partner has not yet been named, but the California Department of Insurance website shows that Tesla is licensed as a broker to conduct business on behalf of the State National Insurance Company (a unit of Markel Corp), according to Reuters.
Back in October 2018, Tesla pointed out that the Model 3 vehicle had the lowest probability of injury of vehicles tested by the U.S. National Highway Traffic Safety Administration (NHTSA). But then the NHTSA sent a cease-and-desist letter to Tesla for making those claims by saying that it “does not distinguish safety performance beyond that rating, thus there is no ‘safest’ vehicle among those vehicles achieving 5-star ratings.”
The insurance of Tesla vehicles are generally the highest due to the substantial repair costs for components and sensor equipment. Tesla’s insurance program is expected to have “comprehensive coverage” for the claims being processed to customers in California and it will be expanding to more U.S. states in the future.
