Elon Musk’s EVs are facing problems on several different levels, causing the automaker to consider insuring.
After another one of the company’s cars spontaneously burst into flames earlier this month, Tesla car insurance is likely to become available. The electric vehicle suddenly started burning while parked in a Shanghai garage. This was not the first time such an event has occurred.
As a result, Tesla is likely to offer auto insurance to let its customers affordably cover their vehicles.
Elon Musk, the company’s CEO brought up the subject of Tesla car insurance and that it will offer owners an opportunity to save money. That said, this coverage will come with a certain level of monitoring to which the driver will need to agree in order to keep the coverage.
Musk has stated that Tesla owners aren’t getting a fair opportunity for coverage from traditional auto insurance companies. They tend to pay considerably higher prices than drivers of similarly priced gas or diesel powered cars. In order to make ownership of the electric vehicles less cost prohibitive, Tesla will likely offer its own coverage.
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Tesla car insurance will involve various levels of monitoring of the driver’s habits and behaviors.
Auto insurance from Tesla will likely be cheaper than what most other insurers will provide. That said Tesla will want to monitor its drivers in order to obtain individual-specific data that will help to show a driver’s own unique risk. The least expensive insurance policy will likely come with full-time monitoring that will allow the electric vehicle maker to thoroughly examine driving habits.
While some drivers will not have a problem exchanging their location, timing and driving habit information for significant savings. However, this type of usage based insurance data collection is already offered by many traditional insurers and it’s not uncommon for drivers to hesitate to sign up. Despite the savings they can earn based on their safe driving habits, the feeling that “big brother” is watching is off-putting to many people, said an Extreme Tech report.
Tesla car insurance could end up being one of several strategies put into place to help turn around its downward earnings trend. The company reported its soft quarterly sales and earnings, which were negative $702 million. This led the company to announce that they would be shrinking their board of directors and making some other substantial changes in the hopes of improving their appeal to customers and investors alike.