Some details about Tesla Insurance were shared during TSLA’s Q2 2020 Earnings Call. Tesla’s CFO Zachary Kirkhorn predicted that Tesla Insurance would be rolled out in a handful of states by the end of the year. He also discussed the main reason Tesla hasn’t released its insurance program in the United States nationwide yet.
“We are working super hard on insurance,” said Kirkhorn, describing Tesla Insurance as “fairly standard” with elements unique to the company’s cars. Kirkhorn clarified that people could think of the current iteration of Tesla Insurance as version 1. Elon Musk corrected him and said it was more like a version 0.9.
Kirkhorn explained that Tesla Insurance centered on the company’s telematics product. “But what we’re working on now is—we can call it version two, or we can call it the first version of our telematics product,” he said. Insurance companies use telematics devices to gather information about a driver’s habits on the road and other data.
Tesla plans to use the data and driving profile of users to “assess correlations and probabilities of [a] crash” so it can calculate monthly premiums for individual customers. Kirkhorn emphasized that the data Tesla’s telematics product collects would not be available in any other product or vehicle in the world, giving the company an advantage in terms of information.
Kirkhorn also elaborated that Tesla chose to hold the expansion of its insurance product to focus on developing the telematics side of it. “And where we are now is nearly complete with the risk and cost analysis associated with the first version of the telematics product. We hope to be filing that in a handful of states with regulators very shortly.”
Kirkhorn forecasted that its telematics product could roll out by the end of the year as soon as it receives regulatory approval. He said Tesla would continue to file for regulatory approval in other states until its telematics product was rolled out nationwide in the US. Tesla would also continuously improve its telematics product.
Elon Musk added to Kirkhorn’s answer. He shared that Tesla’s telematics device could help drivers improve their driving habits, giving them the opportunity to lower their monthly premiums. “It’s also actually very helpful for us to have a feedback loop to see what is driving insurance expense,” said Musk. He suggested that Tesla could use the data it collects to reduce the cost of repairs and improve the design of its cars.Follow @PurplePanda88
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Ma. Claribelle Deveza
Longtime writer and news/book editor. Writing about Tesla allows me to contribute something good to the world, while doing something I love.