Tesla to offer car insurance in the United States
Electric car maker says it can offer lower rates because it 'knows its vehicles best'
Tesla has begun offering car insurance to its vehicle owners in California, touting rates as much as 30 per cent lower than market rates without offering much detail.
The electric car maker is offering online quotes through its website and plans to expand the service throughout the US. Tesla said in a blog post that it would be able to lower costs because the company “knows its vehicles best", but the company said it will not use or record vehicle data when pricing insurance, according to its website.
Chief executive Elon Musk has bristled for years at some Tesla customers’ complaints that they are paying high insurance rates. Costlier coverage undercuts the case the company frequently makes that its cars are the safest in the industry and its driver assistance system, Autopilot, helps drivers avoid crashes.
The availability of the new service is not clear. A single sentence currently appears on the Tesla Insurance website: “Algorithm update in progress”.
Tesla’s insurance product will only cover the company’s vehicles and does not extend to commercial use such as ride-sharing. The car maker says it plans to offer commercial insurance in the future to support its own sharing network.
Tesla shares rose 0.7 per cent to close at $215.59 on Wednesday. The stock has plunged 35 per cent so far this year.
Updated: August 29, 2019 12:44 PM