Tesla plans to reduce insurance costs for its customers by using autopilot

According to experts, Tesla can offer lower rates, because AutoPilot will reduce the frequency of collision claims. The automaker would have a better idea of ​​driver safety based on how often they use AutoPilot and could adjust rates more easily than other insurers.

"They have a lot of confidence in their AutoPilot system," Jessica Caldwell, director of sector analysis at Edmunds, told Automotive News. "It looks like they want to position themselves as their unique selling point, offering insurance that takes into account is quite unique."

The automaker has partnered with Liberty Mutual since 2017 for a program called InsureMyTesla, although it's not clear if the new insurance product would be connected. Although details remain scarce, State National Insurance Co., a subsidiary of Markel Corp., has announced that it will handle the product.

According to a document filed by the California Department of Insurance, State National said Tesla branding would include, among other features, a customer-approved, direct data flow that would "eliminate friction costs and inefficiencies." inherent to traditional insurance processes ". The document also states that "vehicles equipped with a standalone feature option will be eligible for credits based on the level of vehicle range".

The automaker intends to eventually offer autonomous vehicles, although AutoPilot does not have it yet.

Musk, during the phone call on the April 24 results, said that if a driver uses his vehicle "insanely", Tesla could increase that client's insurance rates.

Although auto insurance rates vary widely and depend on factors like age, location and driving history, Teslas insurance is generally more expensive to ensure than competing vehicles because of the costs of their technologies. and their parts.

According to the 2018 data provided by the Insurance Institute for Road Safety, the Model S sedan figured at the top of the list of the 25 most expensive vehicles to insure.

At the same time, a 2019 survey by Insure.com ranked the Tesla Model S 15th among the most expensive vehicles in the country, with an average annual premium of $ 3,300.

"The cost of ownership is a determining factor," said Caldwell. "They had price problems, and cheaper insurance could allow buyers to get close to what they expected to pay."