Tesla Auto Insurance: What Will It Cost You?

According to SmartFinancial’s analysis, the average cost of a new 2022 Tesla Model Y is $1,472.76 but this can vary based on the Tesla year and model. Teslas generally cost more to insure than other types of cars due to their high purchase prices and expensive replacement parts plus labor.

To help drivers manage insurance costs, Tesla launched Tesla Insurance, which claims to cost 20% to 30% less than what you’ll find on the traditional marketplace. However, Tesla Insurance’s footprint is limited to only ten states.

What Is the Average Cost To Insure a Tesla?

Using the 2022 Tesla Model Y as an example, it costs an average of $1,472.76 per year, for a driver aged 30 to 39 years old. The average cost to insure a Tesla will vary based on several factors, including the Tesla year and model, the driver’s age and claims history and location, among other factors.

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Why Do Teslas Cost So Much To Insure?

Teslas are often expensive to insure because they have high purchase prices and expensive replacement parts and repair labor.

High Purchase Price

Expensive cars cost more to insure, which helps explain why car insurance premiums are relatively high for Teslas. According to Find My Electric, an electric vehicle marketplace, a 2022 Tesla can cost over $100,000 before taxes depending on which model you choose.

Tesla cars are equipped with technologically advanced safety features that can help prevent collisions but can also increase prices. Unfortunately, this price increase in Teslas is also seen in their insurance rates. Collision insurance pays to replace your car when it is totaled in an accident. Since Teslas often cost more to replace than cheaper gas-powered cars, they are often more expensive to insure.

Expensive Replacement Parts

Even minor car crashes in a Tesla can result in expensive repair bills because of high-cost replacement parts. According to RepairPal, the average annual repair cost for a Tesla is $832. This is 28% higher than the average annual repair cost of all cars ($652).

Costs can skyrocket when replacing the battery — Find My Electric estimates battery replacement costs for a Tesla Model S between $12,000 and $15,000, excluding labor costs.

Costly Repair Labor

These days, auto technicians must undergo continual training and use expensive, special equipment to fix technology-forward vehicles, like Teslas. Not all repair technicians are qualified to troubleshoot and repair safety systems, like collision warnings and blind-spot detectors. Those who do command higher prices. Search for a Tesla-approved repair shop.

How Much Does It Cost To Insure a Tesla by Make And Model?

Depending on your age and the Tesla model, monthly premiums can range from around $200 to over $1,000. Teenagers face the highest Tesla premiums across the board because car insurance companies flag their inexperience as high-risk indicators. High-risk drivers are more likely to get into car accidents and file an insurance claim.

Age Range	Model Y (2022)	Model X (2022)	Model 3 (2022)	Model S (2022)
16-19	$1,179.50/mo	$726.16/mo	$749.82/mo	$612.86/mo
20-29	$277.78/mo	$347.40/mo	$281.02/mo	$322.02/mo
30-39	$197.82/mo	$263.62/mo	$213.34/mo	$223.95/mo
40-49	$176.70/mo	$257.21/mo	$196.94/mo	$237.07/mo
50-59	$194.27/mo	$279.59/mo	$193.47/mo	$225.01/mo
60+	$197.24/mo	$210.83/mo	$190.37/mo	$194.57/mo

Tip: Consumers should be mindful of the manufacturer’s standard retail price (MSRP) for each Tesla model. Models with a higher MSRP will typically cost more to insure because they cost more to purchase. You may even see a difference within the same model based on which trim you choose. Trims that add features will increase costs, which may also increase your insurance premium.

Which Companies Provide Insurance for Teslas?

Most national auto insurance companies and some smaller or regional carriers will insure Tesla vehicles, including:

• State Farm
• Farmers
• Nationwide
• Kemper Auto Premier
• Victoria Insurance Group
• American National
• Titan
• Nodak Mutual
• Mercury Insurance
• Texas Farm Bureau Group
• Plymouth Rock Assurance
• Mississippi Farm Bureau

How Much Is Tesla Insurance?

Tesla Insurance is Tesla’s automotive insurance product and is advertised to offer rates 20% to 30% lower than what drivers would find in the traditional marketplace. Insuring more than one vehicle through Tesla Insurance may qualify you for a 12% discount on your policy. Other discounts may also be available depending on your state:

• Good/Elite driver (three/five year clean driving record)
• Tesla employee discount
• Mature driver (age 55 and up)
• Good student
• Multi-car
• Anti-theft device
• Airbag
• Autopilot
• Defensive driving course

Tesla uses telematics technology to calculate your premium based on your safety score. The tracker is built into the car and there is no need to insert a plug-in device or download a mobile app to begin monitoring your driving behaviors. You start with a safety score of 90 when you sign up and your driving behaviors will be monitored over the next 30 days. Safe driving behaviors increase your score, contributing to a cheaper premium. Premiums will increase as your safety score drops.

Factors considered when calculating your premium include:

• How abruptly you brake
• How aggressively you turn
• How closely you drive to the car in front of you
• Nighttime driving
• Miles driven within the last six-month period (first six-month period based on self-estimated mileage)
• Tesla model (higher-cost models cost more to insure)
• Location (areas with lower crime rates generally enjoy lower premiums)
• Coverage options and limits (purchasing additional insurance coverage will increase your premium)

Your premium can change from month to month depending on your safety score from the prior month. Tesla provided an example of how premiums can change over six months:

Month	Average Safety Score From Past Trips	Safety Score for Rating	Monthly Premium
1	95	90	$121
2	88	90	$121
3	92	95	$97
4	98	88	$130
5	96	92	$111
6	93	98	$83

Premiums will also increase if you add any of the following endorsements to your Tesla auto policy:

• Total loss deductible waiver: Covers your deductible if you file a collision or comprehensive claim.
• Collision deductible buyback: Pays for your collision deductible for a car accident where the other driver is liable but is either uninsured or underinsured.
• Gap coverage: If your car is stolen or declared a complete loss in an accident, this insurance coverage pays the difference between the remaining balance on your auto loan and your Tesla’s actual cash value.

Where Is Tesla Insurance Available?

Tesla Insurance is available in only 11 states with plans to expand to other states in the future. Due to its small footprint, Tesla drivers in states not listed below will need to shop on the marketplace for an insurance policy.

• California
• Colorado
• Illinois
• Maryland
• Minnesota
• Nevada
• Ohio
• Oregon
• Texas
• Utah
• Virginia

Which Companies Offer The Cheapest Insurance Rates for a Tesla?

Based on all auto policy quotes provided by SmartFinancial, we found that Victoria, Safeco, Titan and Kemper issued the cheapest quotes depending on which Tesla model you insure.

For the 2022 Tesla Model Y, Victoria Insurance Company, a Nationwide affiliate, returned the cheapest annual quotes, on average, at $519 per year.

Insurance Company	12-Month Premium
Victoria	$519
NatGen Advantage	$635
Kemper Auto | Infinity	$817
Virginia Farm Bureau	$962
Mercury Insurance	$983
American National P	$1,002
Indiana Farmers Mutual Ins	$1,128
Texas Farm Bureau Group	$1,196
North Carolina Farm Bureau	$1,261
Safeco	$1,320

For the 2022 Tesla Model X, Safeco charged the cheapest rates, on average, at $1,025 per year.

Insurance Company	12-Month Premium
Safeco	$1,025
Virginia Farm Bureau	$1,143
Capital Insurance Group	$1,148
Farm Bureau Ins of MI	$1,241
Pekin Insurance	$1,353
Mercury Insurance	$1,559
Pioneer State Mutual Ins Co	$1,770
Hastings Mutual Insurance Co	$1,933
Texas Farm Bureau Group	$1,968

For the 2022 Tesla Model S, consumers can expect to pay $1,063 per year, on average, when buying an auto policy through Titan. This auto insurance provider only insures Tesla drivers in ten states: Connecticut, Florida, Maine, Massachusetts, New Hampshire, New York, North Carolina, Pennsylvania, Texas and Washington.

Insurance Company	12-Month Premium
Titan	$1,063
National General	$1,069
Kemper Auto Premium	$1,148
Mercury Insurance	$1,148
Texas Farm Bureau Group	$1,314
Safeco	$1,441
Farmers Mutual of Nebraska	$1,470
Capital Insurance Group	$1,580
Virginia Farm Bureau	$1,588
Indiana Farmers Mutual Ins	$1,615

For the 2022 Tesla Model 3, Kemper issued the cheapest Tesla insurance rates at $878 per year.

Insurance Company	12-Month Premium
Kemper	$878
Victoria	$921
American National P	$1,048
Titan	$1,117
Nodak Mutual	$1,254
Mercury Insurance	$1,327
Texas Farm Bureau Group	$1,464
Plymouth Rock Assurance	$1,560
Mississippi Farm Bureau	$1,572

What Type of Policy Is Best for a Tesla?

If you’re financing your Tesla, then you will need to maintain collision and comprehensive insurance in your auto policy until you fully repay your loan.

If you made a down payment smaller than 20% on your new Tesla, then you will also need to purchase gap insurance.

In the event your Tesla is totaled in a covered car accident or stolen, gap insurance will pay for the remaining balance on your auto loan if it’s higher than your car’s actual cash value. Gap insurance is available directly through Tesla and can be added onto a Tesla auto insurance policy.

Get Personalized Car Insurance Quotes Here

Key Takeaways The average cost to insure a 2022 Tesla Model Y is $1,472.76 and this figure can vary based on the Tesla year and model. Tesla car insurance premiums are often expensive because because Teslas have high replacement costs if they’re totaled and repair and labor costs. Based on SmartFinancial’s analysis, Victoria, Safeco, Titan and Kemper offered the cheapest Tesla insurance rates. Tesla sells their own auto insurance product but is available in only 10 states. Tesla claims that Tesla Insurance is 20% to 30% cheaper than policies purchased on the private marketplace.

If you're unhappy with your current car insurance, SmartFinancial can help you compare rates in your area to find the cheapest car insurance policy for your Tesla. Just enter your zip code below or call 855.214.2291 to receive your free car insurance quotes.

Sources:

• Find My Electric. “How Much Does a Tesla Cost in 2022? New & Used Prices.” Accessed Dec. 22, 2022.
• Repair Pal. “Tesla Repair: Service and Maintenance Cost.” Accessed Dec. 22, 2022.
• Repair Pal. “Car and Truck Reliability - 2022 Ratings.” Accessed Dec. 22, 2022.
• Find My Electric. “Tesla Battery Replacement Cost Explained.” Accessed Dec. 22, 2022.
• Tesla. “Introducing Tesla Insurance.” Accessed Dec. 22, 2022.
• Tesla. “Tesla Insurance Using Real-Time Driving Behavior.” Accessed Dec. 22, 2022.
• Tesla. “Additional Coverages and Discounts.” Accessed Dec. 22, 2022.
• Tesla. “Safety Score Beta.” Accessed Dec. 22, 2022.
• Tesla. “Tesla Insurance.” Accessed Dec. 22, 2022.
• Tesla. “Compare.” Accessed Dec. 22, 2022.
• Twitter. “Elon Musk on Twitter.” Accessed Dec. 22, 2022.