Why is Tesla Insurance so high?

Before buying a car, it’s critical to know all the costs involved with insurance included. Teslas are beautiful, advanced, and high-performance vehicles. But why are their insurance rates so high?

Tesla insurance is so high because they fall within the luxury car category. Besides, repairing a Tesla is not cheap just like many other luxury cars. So, insurance companies consider all of these factors before setting insurance premiums for Teslas.

What’s the average price of insuring a Tesla?

When you compare the average price of insuring a Tesla with other luxury car brands, you will find that it’s quite favorable. You may have to pay around $4,300 per year to insure your Tesla. Nevertheless, the cost may increase or decrease depending on a number of factors.

Some of these factors include your driving history, Tesla model, and how much coverage you pick. Note that insuring luxury cars like Maserati, Audi, BMW, Porsche, and Mercedes-Benz is more expensive than insuring a Tesla. Most of these cars cost over $4,400 to insure on average.

What’s the cost of insuring different Tesla models?

The cost of insuring a Tesla may differ depending on the model and trim that you pick. Besides, other factors such as driving history, coverage, and location are as well as considered. Note that the more expensive the model, the higher the insurance premium will be.

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Astonishingly, the Tesla Model Y may not be the cheapest Tesla on the market, but it’s the least expensive Tesla model to insure. On the other hand, the most expensive Tesla to insure is the model X. This is understandable as it’s a high-end Tesla model.

Tesla Model 3 is the second cheapest Tesla model to insure. This is understandable as it’s also the cheapest Tesla. While Model S is the second expensive Tesla model to insure. Here are the average costs of insuring different Tesla models:

Tesla Model 3 – $3,600

Tesla Model Y – $3,080

Tesla Model X – $5,120

Tesla Model S – $4,800

Note that these are just rough estimates from top insurance firms like Geico, State Farm, Allstate, and Progressive. 

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What is Tesla insurance?

This is a program that was launched in August 2019 with the goal of making Tesla a one-stop provider for car services. Tesla insurance is intended to provide car insurance services to Tesla owners. Since Tesla has a better understanding of their vehicles and how they operate, they saw the need to provide better insurance premiums to their customers.

However, this program is not well spread around the country. It’s currently being offered in California State alone. Unlike conventional insurance companies, Tesla’s pricing is based on the vehicle’s safety systems, but not on their personalized driving information.

The Tesla Insurance program features basic collision, liability, and comprehensive packages. Besides, they also offer electronic key replacement, identity fraud, and wall chargers. Using a different approach from conventional insurance companies, Tesla will reduce the cost of insurance for Tesla owners.

What are different coverage offered by Tesla?  

Like other automotive insurance companies, Tesla will offer all the main types of coverage, which will include liability insurance, collision insurance, personal injury protection, and comprehensive insurance. Note that Tesla insurance premiums will cost around 25% less than what other companies are charging.

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Special coverages provided by Tesla Insurance

Tesla insurance will also have special services that it will provide to its customers in a bid of swaying them to migrate from their insurance to Tesla’s insurance. Some of the special policies that will be featured in their vehicle packages are:

  • Cyber identity fraud expense – compensate for the costs of digital identity fraud, up to $15,000 per event and $30,000 per policy period.
  • Autonomous vehicle owner liability – includes any bodily harm or property damage that takes place when your vehicle is running in autonomous vehicle mode, up to the same limits of liability during driving.
  • Electronic key replacement – this covers up to $500 of the loss of electronic car keys for two occurrences in the same insurance period.
  • Loan or lease gap coverage – This safeguards you when your car is damaged or stolen. It covers the balance of your car loan or lease, based on the value of your car.
  • Wall charger coverage – it covers the loss or damage of your electric charger. The coverage is limited to $3,000.


Can I get car insurance for my Tesla?

Yes, you can. It’s just the same procedure for getting insurance for a BMW, Audi, Maserati, Benz, or any other car. If you want to land the best insurance premium for your Tesla, compare quotes from different insurance companies.

What determines the insurance rates for my Tesla?

Like any other car, the insurance company will look at things such as driving experience, driving record, the value of the car, coverage needs, and personal information like age, gender, and much more. And since Tesla is a luxury car, expect it to have high premiums.

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Is Tesla Insurance full coverage?

Yes, Tesla insurance provides comprehensive coverage. However, this service is not offered worldwide or in the whole country. Only Tesla owners in California can enjoy this service at the moment. Nonetheless, Tesla plans to expand to other regions of the country.

Does owning a Tesla save you money?

Of course, it does. When you compare the cost of fueling your car and charging a Tesla, you will find that you will save a lot annually. Aside from that, Tesla doesn’t need frequent visits to the mechanic like gas cars. Therefore, the cost of maintenance is very small compared to ICE vehicles.

Which car is expensive to insure – Tesla, Mercedes, or BMW?

Tesla may be among the most expensive electric vehicles to insure, but it’s way cheaper than other luxurious vehicles. When you compare the cost of insuring a Tesla versus a Mercedes-Benz and BMW, you will find that insuring a Tesla is cheaper than both Benz and BMW.


To sum up, Teslas are expensive to insure because they fall in the category of luxury cars. On top of that, they involve expensive repairs as Tesla replacement parts don’t come cheap. However, when you compare Tesla with gas-powered luxury cars, you will find that it’s way cheaper to insure than most of them.

Edwin Odipo

Why do you love writing about cars? Cars make our lives easy. You can visit your distant friend, relative or even rush to the grocery store a few miles from your home with a lot of ease. Imagine how life was before the invention of cars?? To me, cars are a blessing that made life more convenient.

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