In California, Tesla already insures its customers’ cars itself, and there is growing evidence that the EV manufacturer is planning to do the same in other parts of the world. In China, a corresponding company has already been founded.
On 6 August, Tesla registered a new company called Tesla Insurance Brokers Co, Ltd, an insurance brokerage firm with a capital stock of 50 million yuan, the equivalent of 6.1 million euros. Tesla Motors Hong Kong Limited holds all shares, with Zhu Xiaotong registered as the legal representative. The manager is not only vice president of Tesla, but also head of the Greater China region for the electric car manufacturer.
What remains to be seen is when the new insurance subsidiary will offer its first products and at what rates. At Tesla – especially in China – things can happen very quickly.
In Europe, too, Tesla seems to want to offer its own insurance rates for its electric cars soon. As Torsten Kusmanow, insurance expert and partner in the digital sector at the consulting firm Capco told the German publication Automobilwoche, it is only “a matter of time before all hurdles are overcome”. Overall, he said, it was “not so easy” for foreign companies to gain a foothold as insurers in Germany. Business operations, he said, had to be based in Germany and the contracts had to be tailored to local guidelines.
According to Kusmanow, Tesla could avoid a major problem that many established insurers are inexperienced with electric cars. “Tesla has a huge information advantage here because the vehicle is virtually made up of data only,” the expert says. “The driver is constantly connected to the main systems through the vehicle systems, so Tesla engineers can intervene in the software, for example, if problems occur. Tesla is thus optimally supplied with data on driving behaviour.”
Since August 2019, Tesla has been offering its own insurance company ‘Tesla Insurance’ in California, which is to offer its customers 20 to 30 per cent lower rates. In the call for the second-quarter results, CFO Zachary Kirkhorn indicated that Tesla intends to use this experience to establish an insurance business outside California. He spoke at the time of “a handful of states” in which such services (subject to regulatory approvals) could be offered by the end of the year.