The Trouble With Teslas

In Austin, it seems that there is a Tesla around every corner. It has to be one of the most popular new vehicle purchases in 2016 for my clients and my guess is that this will become the trend. As they become more popular, insuring them continues to present some challenges. You may ask: What’s the trouble with insuring a Tesla?

Insurance Valuation: Their value can present some insurance companies with a challenge. No matter if you have picked up a model S for $80,000 or a beautiful model X for $140,000, vehicles of this value can get complicated when it comes time for securing the insurance. Will the insurance company cover it for an agreed value amount or market value? Will their underwriting guidelines even allow them to be accepted on your policy? For many insurance companies, the answer is no.

Repairs: The more complicated repair process has caused many insurance companies to shy away from providing insurance for them. Because Teslas need to be repaired at a certified Tesla repair facility, there can be significant added expense to the claims totals involved with the shipping of the vehicle to the proper site. Most insurance companies don’t have a separate rating structure in place to account for this when calculating premiums and therefore believe they are not collecting premium commensurate to the risk. For many, it’s better to just say no!

Catching Up With Technology: The entire reason we have fallen in love with the Tesla, its technological capabilities, have created a yet unknown risk exposure that make many insurance companies anxious. These vehicles are outfitted with Autopilot, a driver assist feature that has been in the news frequently recently, and not all for the right reasons. Unfortunately, Autopilot is not foolproof. There are several cases currently under investigation where Autopilot did not operate as intended and it resulted in bodily injury and property damage.

These vehicles are not on the menu for many insurance companies. However, the right agent should be able to successfully navigate the complicated underwriting environment surrounding the Tesla and find you the right insurance options. Independent insurance agents are best suited for handling the needs of more complicated lifestyles. If you have your heart set on a Tesla, don’t hold back. Give the Tesla-experienced agents at Watkins Insurance Group a call. We’re here to help! (512) 452-8877

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