Tesla Insurance Secret Move to Dominate Multiple Industries
Tesla Insurance and Its Secret Hidden In Plain Site
Tesla insurance is starting to disrupt traditional insurance. There is a secret move that Elon Musk and Tesla insurance are making to disrupt everybody. What is it?
Tesla insurance is now available in 5 total states: Arizona, California, Illinois, Ohio, and Texas. This is the start of a steep S curve of ramping to different states in the United States. In order to work with each state, there are different requirements and Tesla will have to customize its insurance for each state.
Elon Musk has been saying that by the middle of February, 2022, Tesla could be in 8 different states for its insurance. Another interesting aspect of Tesla insurance is you can apply and get a rate in 1 minute. This is a disruption of traditional insurance which requires you to fill out multiple forms and go through a hassle.
Tesla insurance will be easier to get, will be easier to determine your rate - it will be based on your Tesla safety score, and will be clear, cut, and dry. This simplicity, I believe, is what will disrupt the traditional auto industry.
Tesla will have the data from your driving to determine your rate. They will have data from multiple aspects of safe driving that is recorded in real time. One of these is how close you drive behind cars in front of you. A regular insurance provider just can't do this.
This and other categories of data would aggregate over 30 days and give you a quick answer of your driving score and insurance rate. This data makes Tesla able to give really low rates to really good drivers and higher rates to those drivers who may be more risky.
Other insurance providers can't quite do that with your car, except with your number of accidents or major violations. They can't get the granular and fine detailed level of data that Tesla can.
Tesla's secret hidden in plain site is that it has its Tesla driving score and simple process of getting insurance rates that is better and easier than other insurance providers. In addition to this, Tesla with auto pilot is 10 times safer than a non Tesla car. They have the data to show this. In traditional insurance, everyone is overcharged somewhat, so that safe drivers end up compensating for bad drivers who end up using insurance much more often.
Tesla will have mostly safe drivers who already use Tesla and auto pilot and will be safer and won't be in the traditional auto insurance situation where you are getting overcharged. Tesla will have no over billing. Really safe drivers will get a much better deal than with a traditional auto insurance company.
Once those good drivers are using Tesla vehicles with Tesla insurance, they will leave their old insurance, causing old insurance companies to have to raise their rates to support worse drivers who get into accidents more often. This is the big secret.
Tesla insurance is in 5 states right now. If they are going to get into 8 states by the middle of next month, it means that they could be in about 40 states by the end of the year.
Let's say that Tesla is in all 50 United States by the end of next year or sometime in 2023. That means Tesla insurance is widespread and more and more people are using Tesla vehicles and Tesla insurance.
Then, in another year or two when Tesla starts having robotaxis on the road, Tesla will have to insure their own robotaxis. Tesla won't have to go to another insurance company to get insurance. Tesla will have solved insurance and be able to pay for it themselves and others using Tesla robotaxis will pay Tesla insurance.
Tesla will be able to flip a switch when the time for robotaxis come and won't have to shop around for insurance. Any other autonomy company will have to shop around for insurance. This gives Tesla an edge in autonomy in getting there before other people. This is another secret hidden in plain sight. Tesla will disrupt traditional auto companies, traditional auto insurance and autonomy services with this approach.
And lastly, if other people license autonomy from Tesla, I think it would make sense for them to also use Tesla insurance, thus Tesla could become one of the largest auto insurance providers in the world.
Will Tesla insurance grow to be huge from where it is today? Will Tesla insurance dominate multiple industries, including autonomy?
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Jeremy Johnson is a Tesla investor and supporter. He first invested in Tesla in 2017 after years of following Elon Musk and admiring his work ethic and intelligence. Since then, he's become a Tesla bull, covering anything about Tesla he can find, while also dabbling in other electric vehicle companies. Jeremy covers Tesla developments at Torque News. You can follow him on Twitter or LinkedIn to stay in touch and follow his Tesla news coverage on Torque News.
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