Listen: Teslas Auto Insurance Gets Off to a Rocky Start
"Business Wars daily is sponsored by audible audible has the world's largest selection of audio books and Audio Entertainment Start Listening with a thirty day audible trial by visiting audible dot com slash B w daily or by texting. Bw Daily to five hundred five hundred from wondering I'm David Brown and this is business worse daily on this Thursday September nineteenth can self driving car or one with driver assist technology drive more safely than you can. That question is at the heart of how much car insurance may cost in the future and if you're a tesla owner the very near future future late last month. Tesla debuted its latest new product. Auto Insurance Tesla's are famously among the most expensive cars in the country you to ensure one reason why Tesla owners were so interested when Elon Musk tweeted his plans to offer insurance must promise that the company could offer premiums that would be twenty to thirty percent less than those from traditional insurance companies. Tesla has several advantages that should make for lower premiums must claimed claimed those advantages include Tesla's knowledge of its own cars and driving safety system called autopilot. That's intended to help drivers avoid accidents and of course the precise driving data collected by cameras and GPS systems installed in the vehicles themselves. Tesla is in the only company using data to determine are driving risk and how much to charge for coverage shop for any insurance policy and you're likely to be offered the opportunity to install a tracking device in your car. You know the the kind of transmits your driving habits for better or for worse directly to your insurer in return. They promised discounts to good drivers well. Whether you you take the offer depends on how you feel about privacy how much money you're likely to save and how confident you are and you're driving and possibly whether you like the idea of keeping electronic tabs on your teenager who was newly behind the wheel. What's new here is that the data tesla collects on its owners isn't really optional? It's how how the vehicles work and that Tesla says allows it to get more accurate pictures of your habits from how often to how far and how fast you drive it still tesla says it's not using individual information to price insurance at least not yet instead like regular insurance companies. Tesla is grouping groupings. An- anonymous data of course insurance rates are affected by other things as well including your location the model value of your car and your age obviously obviously Tesla can't control any of those things still it's offering perked the interest of current Tesla owners and could help Tesla's sell more cars by reducing the insurance coverage sticker shock if that coverage is in fact twenty to thirty percent less well that turned out to be a big if on Launch Day August twenty eight the first excited customers went online for quotes but that excitement rapidly turned to scorn in many cases those quotes were far higher than the price is owners were paying at companies like USA and gyco according to scores of comments in Tesla owner forums and other online sites so what happened was musk overly optimistic. Well know many of those. sky-high quotes seem to have been mistakes stemming from bugs in the algorithms that determine prices. Tesla took it sight down for a few hours the same day to fix the problem problem. Since then at least some customers have been seeing promise savings on twitter. One customer boasted that his insurance for 2017 Model X. Through allstate was more than four hundred dollars a month his Tesla insurance quote about seventy bucks. The company's insurance offering isn't designed solely for the prophets. It's it can bring to Tesla. It's also intended to help drive badly lagging car sales one factor in those slowing sales may well be the high cost of ensuring the vehicles witness another other twitter user a woman named Katie who tweeted on September third insurance prices have been the biggest thing holding me back from getting my Tesla. Please get this to Illinois Asap while Tesla is the number one selling electric car in the US electric vehicles still make up a tiny percentage of all car sales so tesla insurance insurance is hardly likely to shake up the huge auto insurance business right away but down the road well it could very well disrupt the insurance industry as we we buy more electric cars or when other automakers decide like musk to compete with the allstate's in Geico's of this and I'm wondering this business for his day. Hey if you like this episode hit that Subscribe Right Button on your favorite podcast APP that way you thing. I'm David Brown back with you tomorrow. Today's episode of Business Wars daily is brought to you by audible. Audible has the world's largest selection of audio books and audio entertainment right now. I'm listening to an audible original. Call it burns the scandal plagued race to breed the world's hottest Chili. It's wild. 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