Today we are going to take a look at the best insurance for your Tesla Model 3. While discussing auto insurance may not be the sexiest topic out there, it is an important one. If you drive you need to have insurance. This point was hammered home for me on a very personal level last month when I was hit by a drunk driver. I wasn’t hurt but my beloved Nissan Leaf that I have mentioned on several occasions was totaled. Luckily, the car was paid for and my insurance was able to quickly cut me a check. I was able to get a replacement within days. Had I not had insurance, I would have had to wait until the drunk driver settled her case and gone through her insurance to try and recoup the costs. Talk about adding insult to injury…
So, all that being said…you need insurance.
Also: DON’T DRINK AND DRIVE!!!
Options for Tesla Model 3 Insurance
Choosing the right type of insurance for your Tesla Model 3 will mean different things to different people. What is your budget? Do you insist on full coverage for your cars or are you comfortable with liability only? How old are you? What is your driving record like? Where do you live? All of these variables will have an effect on what type of rate you are offered. One thing is certain: Tesla vehicles are not cheap to insure! In a recent interview with Autonews.com, auto analyst Maryann Keller told writers for the website:
“There’s a reason why Tesla has one of the highest insurance rates; it’s because it’s impossible to fix. You’ll look at them and you’ll say, ‘There’s nothing wrong with the car. It’s got a small dent.’ Well, that little dent may cost $15,000 to fix — or more. The real question is can anyone bring these cars back to original equipment condition? That’s the promise of insurance.”
While this is certainly hyperbole, Tesla’s business model does rely on a bit more secrecy than other automakers. This is because Elon and Co. have integrated all services surrounding their cars. As we discussed here, I can have my Honda worked on by my neighborhood mechanic. I can then drive down the street and fill it up at the Mobil station. Tesla (for the most part), requires owners to have their vehicles fixed at service centers owned by the company. Tesla is also attempting to corner the market on charging with its Supercharger Network. Additionally, Tesla does not publish service information about their vehicles. This all but eliminates most independent mechanics as options when repairs need to be made.
I can’t guarantee that the companies on the following list will definitely give you the best price, they do seem pretty popular with Tesla owners on the various forums:
- USAA – If you’re currently serving or have served in the U.S. military, or if either of your parents have served, USAA is a great option. USAA is consistently ranked highly for both price and customer service.
- Ameriprise – Did you know that Costco sells insurance? I didn’t but I’m going to check them out. Their prices seem reasonable and you can bundle multiple policies for extra savings.
- Mercury – Known for the cheapest insurance around, Mercury is a good choice. I must say that after my accident mentioned above, the customer service was great and there was no stress in replacing my car.
- Progressive – Apparently, Progressive offers a “Smart Technology Discount” that all Teslas qualify for. Not too shabby!
- State Farm – While not the cheapest, State Farm is a first class operation. If you’re not too concerned with saving a buck or two, they are the way to go.
How Much Does it Cost to Insure a Tesla?
Again, it depends on the factors above. Costs will also rise and fall depending on your car’s value, age, and reason for use (i.e. personal or business). As per usual, I turned to the various Tesla forums for some real world expertise. Posters to this thread on Tesla’s official forum gave ranges of $1,000 to $1,300 per year for insuring their Model 3s. One poster was quoted $2,500 per year, but was able to get a different company down to $800 per year. Several Model 3 owners on this thread also suggest that you bundle your home and/or renter’s insurance with your auto insurance. Doing so can not only save you money, but also make things easy when it comes time to pay the bills.
A user going by the name “tvad” posted the following to the Tesla Motors Club Forum after a 22 year old male from San Antonio, Texas informed the group he would be looking for insurance for his brand new Model 3:
“My best advice to you is to contact an independent insurance agent who can provide quotes from several companies. Try to find one who sells Mercury Insurance among the carriers. Many folks here will offer well-meaning advice based on their personal insurance carrier and policy…but the fact is, only someone who lives near you in San Antonio and is close to your age can offer any concrete numbers for you to compare.”
I must agree with “tvad.” I have had Mercury for years and have found their rates to be very competitive. Still, it would be irresponsible to give a blanket number for how much they will charge you for insurance. You are going to have to do a bit of legwork unfortunately.
Are Teslas More Expensive to Insure?
Well…define more expensive. More so than my Nissan Leaf? Probably. More expensive than a 2020 Bugatti Chiron Super Sport 300+? Probably not. Of course, if you can afford the Bugatti you’re probably not too concerned about insurance costs. For those of us cheapskates who are constantly looking for ways to save money, Tesla may have a solution for Model 3 owners: insurance through Tesla itself. That’s right. You can purchase insurance for your Model 3 directly from Tesla IF…you live in California that is. According to Tesla’s website:
“Tesla Insurance is a competitively priced insurance offering designed to provide Tesla vehicle owners with up to 20% lower rates, and in some cases, as much as 30%. Tesla Insurance offers comprehensive coverage and claims management to support Tesla owners in California and will expand to additional U.S. states in the future. Tesla Insurance offers a convenient monthly payment with no hidden fees or charges.”
For a company striving to keep everything in-house, this makes perfect sense. How it compares to other companies with regard to price and customer service remains to be seen. Perhaps when they branch out to other states, we will get a better idea of how well Tesla does in the insurance game. One major disadvantage to Tesla’s insurance services is that you cannot bundle multiple loans. Tesla only offers auto insurance and not other types such as homeowner’s or renter’s. Still, I wouldn’t ever bet against Elon Musk. He has a way of making naysayers look particularly stupid.
Anyone out there have insurance through Tesla and care to comment? What other companies can you recommend to your fellow Tesla owners? Please leave us a comment below and share your thoughts.
Source | Images: Tesla Motors