Morgan Stanley analysts say Tesla Insurance could pose a long-term threat to the U.S. auto insurance industry. This could be because the company is developing its new insurance product which uses real-time driving data.
At the same time, they noted that Tesla’s product does not pose a threat to the industry in the short term.
A pricing strategy to be clarified
According to analysts, successful long-term market penetration depends on the complexity of the pricing and distribution strategy. However, it is worth considering that Tesla will undoubtedly have the best data on its cars.
The real-time driving behavior feedback loop that is contained in the insurance offer can lead to safer driving, which can result in lower insurance premiums and higher acceptance rates. An additional advantage to the Tesla meter…
As one user put it, “If you can save up to 60% on your insurance every year because you have a Tesla, far more people will consider buying a Tesla than any other car brand. Low maintenance cost, cheap insurance and the best charging network will be hard to compete with. »
Insurance made in Tesla is gaining popularity
Analysts say, “We will be watching TESLA’s underwriting results closely as it gains popularity.” Meanwhile, Tesla customers report being very happy with their monthly payments with Tesla Insurance, which in some cases are 60% less than what they paid with previous insurers.
Objective: gaining safety on the road
Using real-time data, Tesla is trying to do something good for its customers, save money and make the roads safer, according to Tesla CFO Zachary Kirkhorn. We can quite imagine that the development of autonomous driving promotes the brand’s confidence in its cars and therefore in the driving of its customers.
Indeed, if the cars drive “alone”, the inattention or poor driving of a Tesla owner is less impactful than that of a driver who does not benefit from driving assistance. It is then easy to envisage that the number of accidents will be lower and therefore ultimately that the cost linked to insurance will fall.
Data provided in real time
Tesla CEO Elon Musk also explained that real-time data provides feedback to Tesla. This is how the company sees whether there is an accident, whether big or small, and what caused it. This allows her to think about how she can modify the car’s design or the software to minimize the likelihood of a particular accident.
Fewer accidents and faster repair
Musk said, “Most accidents are minor, but how do you make those accidents occur less frequently ? And how to make the repair associated with this accident is super fast ? For example, one could aspire to have the repair of a collision done the same day, which represents a difference of day and night compared to the current situation, where it sometimes takes a month for claims to be made. compensation are settled and resolved, as Tesla also handles collision repair. »
Here we have a whole host of particularly interesting questions, the answers to which will probably emerge over the years, when Tesla will have more perspective on its models. What must be kept in mind, however, is Tesla’s stated desire to make the roads safer for drivers by developing dedicated tools. In addition, the question of the associated repair also seems elementary for Musk.
Indeed, how many times have we found ourselves like an apple for several days, without a car because the repair took too long? With this kind of thoughts materialized, let’s hope it doesn’t happen again! We are also impatiently waiting for Musk to specify when the repair of the car will be possible on the same day as the accident… To know that all these exciting things are happening only in the United States – for the moment.