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Danger Ahead for Tesla Insurance: Faulty Forward Collison Warnings Inflate Premiums, Triggering Class-Action Lawsuit

Tesla insurance is under scrutiny as of late and the reason is its faulty forward collision warnings. These are reducing safety scores, inflating insurance premiums, and have triggered a class-action lawsuit.

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Tesla Forward Collision Warnings Inflate Premiums

Take a look at the picture here from my phone. This is my Tesla Safety Score for the last 30 days. Right now, it is a 98 overall. It is this way because I drive like a grandpa most of the time, being very careful and cautious. Even with this careful and cautious driving, I sometimes get dinged for a forward collision warning that appears out of nowhere and I seem to be in no danger of hitting anything.

A forward collision warning means that the software thinks you have a chance of hitting something in front of you if you don't slow down.

Forward collision warning

Most days, I get a 99 or 100 on my safety score. However, every so often - once or twice a month - I get a forward collision warning and my score goes down to around 55 for that day. I then have to drive more to get my score up to around 80 - and in the case of Nov. 24, 2023, an 81.

I love Tesla insurance and its real time calculation of the safety score. But Tesla needs to fix its forward collision warnings. Tesla either needs to make them less impactful to the safety score, or reduce the threshold for calculating a forward collision warning. I've never gotten a legit forward collision warning - only ones that seemingly come out of nowhere, and I am in no apparent danger.

In addition to this, Tesla needs to make it easier to reach out to an insurance representative via the Tesla app for any questions. If Tesla fixes these two things, Tesla insurance will be incredible. As it stands now, I'm constantly on edge driving around, staying way too far from vehicles in front of me, making sure I don't get a forward collision warning.

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Class-Action Lawsuit Against Tesla

Apparently there is a class-action lawsuit against Tesla and its insurance product in California, with a judge allowing a prospective class-action lawsuit to move forward. Lawsuits are nothing new to Tesla - quite often it is in the news for its Autopilot software and usually when there is an accident, it is driver error.

Still, this lawsuit is actually one that I think is reasonable and SHOULD move forward. If I didn't drive so carefully, probably annoying drivers all around me, my safety score would be much lower, and I'd be paying $30 to $50 more a month in insurance premiums.

The facts of the lawsuit are this:

  • Ricky Stephens filed the lawsuit in April on behalf of multiple Tesla drivers in a dozen states saying that Tesla insurance charge inflated premiums due to faulty forward collision warnings
  • Stephens alleges that Tesla's insurance policy promised to calculate premiums based on Tesla drivers' real-time habits, including forward collision warnings being triggered
  • The lawsuit alleges that many Tesla drivers have random or sporadic forward collision warnings that affect their score negatively, but are not indicative of their safe driving behavior
  • Tesla's motion to dismiss was denied

For most lawsuits against Tesla, I think they are nonsense and overblown. For instance, some try to sue Tesla over fires that were not even the fault of Tesla. I do not think this lawsuit is nonsense and overblown, however, and I am a Tesla owner and investor.

In this case, I am calling it like it is, and I hope Tesla LISTENS. Tesla, please fix your forward collision warnings in your Tesla insurance product. Here's how Tesla can do it.

  • Better calibrate forward collision warnings so that they only occur when there's a real chance of a collision
  • Make a forward collision warning less penalizing. It shouldn't take my safety score from 100 to 50 for that day just from one forward collision warning

If you have Tesla insurance and would like to see this happen, then do me a huge favor and share this article.

Tesla adjusted its insurance safety score for late night driving - because many people spoke up about how much of a problem it was. I still think late night driving is too penalizing, but at least some progress was made when people shared their voice.

I do believe Tesla will listen to this complaint about forward collision warnings and make necessary changes. Tesla, after all, operates at the speed of thought and makes changes quickly - when they see the value of it.

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What do you think about Tesla insurance and this class-action lawsuit? Should Tesla adjust how they calculate forward collision warnings, as well as the impact they have to the Tesla safety score?

Share this article with friends and family and on social media - or leave a comment below. Thank you so much for your support!

Hi! I'm Jeremy Noel Johnson, and I am a Tesla investor and supporter and own a 2022 Model 3 RWD EV and I don't have range anxiety :). I enjoy bringing you breaking Tesla news as well as anything about Tesla or other EV companies I can find, like Aptera. Other interests of mine are AI, Tesla Energy and the Tesla Bot! You can follow me on X.COM or LinkedIn to stay in touch and follow my Tesla and EV news coverage.

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Eric Ryder (not verified)    December 12, 2023 - 10:08AM

My score is 81 mainly because of a ridiculous number of FCW's. 40.3. And Hard Breaking, which i never do, is 1.8%. Which is in the red. I'm 63 and haven't a great driving record. No accidents except a minor one about 25 years ago. Shouldn't one's driving record come into play here? At least a little? No claims, no tickets, no accidents, yet I'm gonna have to pay more because i drive LIKE A HUMAN BEING? Maybe a little aggressively, but obviously not dangerously so, or I'd have a horrible record, right? I'm already paying 50% more for my new MYLR AWD than i was for my 2023 Bolt EUV Premier. A car that has more useful tech in it than the Tesla. Like 360 top down parking assist, cross traffic warnings for backing up, and A FRONT BUMPER CAMERA. Maybe if there Model Y had one of these, we wouldn't have ridiculous warnings non stop for forward collision. Which i probably get mostly from trying to park in my own garage!!! Fix it, ELON!!

Keith Janson (not verified)    January 31, 2024 - 11:06PM

TLDR; same experience for me - very frustrating.
Surprised there are not more comments. I absolutely support those lawsuits and I hope it spreads to Maryland. In the past few weeks, with an average/overall SS of 100, I received three bogus FCWs resulting in large hits to my SS and substantial increases to my premium. In none of those cases did I get the "red hands" warning on my Model 3 display, and only one instance had a possible audible warning (hard to say when the FCW happened). I use FSD probably close to 99% of the time, and some of the bogus warnings I get (many more than the three most recent) accompany FSD disengagements. In 2.5 years of ownership, I believe I had possibly one legitimate FCW. On the highway, necessary FSD disengagements also often result in "Unsafe Follow" hits to my safety score because I happen to be unavoidably too close to another vehicle. For example, when traffic is heavy FSD fails to merge onto a highway safely and I need to disengage before I am able create distance from a vehicle that has just cut into the right lane.