March 24, 2022
Tesla Expands Insurance Offerings to Include More States
What: Tesla is expanding its insurance offering into more states. With integrated telematics in every car, Tesla has better driver safety data than most insurers, which gives them a unique marketplace advantage. In a departure from its previous offerings, Tesla’s insurance in Oregon and Virginia will be underwritten by Tesla’s in-house insurance company.
Why it matters: Embedded insurance is the least frictional process for customers, and is potentially very threatening to the traditional insurance model. What happens to traditional distribution channels when insurance is included at the point of sale by a Tesla dealer?
Business Owners Worry About Charging Station Cyber Attacks
What: Business owners are turning to electric vehicles to help mitigate rising fuel costs, but increased usage raises a growing concern – cybersecurity. 76% of business owners are worried about the potential risk of charging stations being targeted by hackers, ransomware, and other attacks.
Why it matters: Hackers are always looking for new ways to exploit businesses, which is why it’s important for business owners to be aware of the potential risks and take appropriate precautions. Hackers are clever, and when given an opportunity, they often succeed.
Read: HSB Cyber Survey Finds Electric Vehicles Drive Data Security Fears | Business Wire
Tesla’s Big Advantage
What: Tesla has two massive advantages over traditional auto insurers: distribution and data. Having an established relationship with its customers, a trusted brand, and integration with the car sales process, makes Tesla insurance an easy sell. Its data around accident causes, driver behavior, and collision frequency can drive down operating expenses and provide cheaper coverage for its customers.
Quote: “The amount of money that people spend on car insurance is like a remarkably big percentage of the cost of a car,” said Musk during a recent earnings call. “A lot of that insurance cost is just because the insurance companies don’t have good information about the drivers.”
Why it matters: Tesla’s data and connection to its customers are driving down costs, and demonstrating the great potential of embedded insurance. As Tesla expands its insurance offerings, we expect to see traditional insurers feeling the pressure.
Read: Tesla, Other Car Makers Have Edge Over Incumbent Auto Insurers: Moody’s
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