Car insurance on a Tesla can cost more than $220 per month for full coverage, which is significantly more than the cost of similar coverage for other vehicles. Car insurance for Teslas is so expensive in part because of high repair costs and the difficulty involved in repairs. Additionally, Teslas are expensive cars, and expensive cars typically cost more to insure.
Why Insurance on a Tesla Is So Expensive
- Most mechanics and shops aren’t Tesla-equipped. Tesla has practically done away with needing to see a mechanic a few times a year, but this means that if your Tesla needs repairs or bodywork, finding a shop that knows what to do can be difficult.
- Parts for Teslas are extremely expensive. For example, a front drive axle kit for a 2020 Model 3 costs over $400 while the same part for a 2020 Honda Civic would be less than $200.
- Insurers may be wary of the technology included in many Tesla models. Teslas include a multitude of sensors to prevent the driver from crossing lanes or driving too close to other vehicles, and some Teslas even include self-driving and autopilot capabilities. If this technology malfunctions, the resulting accident could be costly.
Tesla Car Insurance
Tesla created their own insurance company to offer specialized coverage for their cars. Coverage is currently only available in Arizona, California, Illinois, Ohio and Texas, with plans to expand to more states in the future.
Tesla claims their own insurance can be 20% to 60% cheaper than coverage from other auto insurance companies, in certain states, because premiums are based on real-time driving habits. Tesla Insurance also states that they do not take into account most common factors that insurers use to determine rates, such as accident history, credit score, age, gender, or marital status.
To learn more, check out WalletHub’s guide to the average cost of car insurance for different types of drivers.
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