Austin, Texas-based Tesla has revealed plans to expand its auto insurance offering in two more states in the US, Oregon and Virginia.
According to a report by Forbes Advisor, in these new states, the policies will be underwritten by Tesla General Insurance for the first time, as opposed to partner companies in other states. The company currently offers auto insurance in Arizona, California, Illinois, Ohio, and Texas.
During a Tesla earnings call back in October 2020, Elon Musk, CEO and product architect of Tesla, said insurance someday could represent 30% to 40% of Tesla’s auto business. He added that Tesla is building “a major insurance company.”
Zachary Kirkhorn, Tesla’s chief financial officer, has said the company will eventually roll out auto insurance nationwide. On a Tesla earnings call in January 2022, Kirkhorn reportedly said the current goal is to be in enough locations that, by the end of this year, 80% of the comapany’s US customers can buy their auto insurance from Tesla.
Tesla’s insurance uses data based on an individual’s driving behaviour to set rates, a safety score between 0 and 100 is then calculated. Customers can see their score on the Tesla app.
The company said its “competitively priced” premiums can deliver savings of 20% to 30%. For the average driver who’s getting a Tesla safety score, the savings can run between 20% to 40%, and for the safest drivers, Tesla said the savings could be between 30% to 60%.
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