How Much Does It Cost to Insure a Tesla?

Last Updated on October 14, 2021

When shopping for new cars, it’s important to consider the cost of car insurance.

Tesla car insurance costs vary depending on your model and other factors. However, most Tesla drivers spend between $3,000 and $5,000 per year for full coverage car insurance.

How much does Tesla auto insurance cost? What’s the best insurance company for Tesla drivers? Keep reading to discover what you need to know about Tesla insurance costs.Tesla insurance cost

Table of Contents:

The Average Tesla Driver Pays Around $4,443 Per Year for Car Insurance

According to rates provided to our model driver profiles, the average Tesla driver can expect to pay around $4,443 per year for full coverage car insurance.

For comparison, the average American pays around $1,450 per year for full coverage car insurance. That means Tesla drivers pay over triple the nationwide average.

Depending on your Tesla model, you could pay significantly more or less than $4,443 per year for car insurance. The cost of car insurance varies depending on your coverage options, your driving history, your insurer, your ZIP code, and other factors.

Tesla Insurance Cost by Model

Different Tesla models have different insurance costs. Depending on which model of Tesla you drive, you could pay anywhere from $3,000 to $6,000 per year for car insurance.

Understandably, higher-end Tesla vehicles cost more to insure than cheaper options. Here’s how much you can expect to pay for each Tesla model:

  • Model Y: $3,121 per year
  • Model 3: $3,611 per year
  • Model S: $4,793 per year
  • Model X: $5,004 per year

Each model has different trim options. You could pay more or less for car insurance depending on whether you have the base model or a model with extra features.

Other Factors that Impact Tesla Car Insurance Premiums

Insurers consider hundreds of factors when calculating rates. Depending on the following factors, you could pay significantly more or less to insure a Tesla:

Coverage Options: Most Tesla drivers carry full coverage car insurance. However, some Tesla drivers carry minimum liability insurance, which is the only insurance required in most states. If you carry minimum liability insurance, then you could pay as little as $800 per year to insure your Tesla. However, if you cause an accident, you’ll pay for repairs out of pocket.

State Insurance Laws: Some states have costlier car insurance than others. Florida and Michigan, for example, have some of the most expensive insurance premiums in the United States, while Idaho and Ohio have some of the cheapest. Depending on your state, you could pay anywhere from $1,500 to $5,500 per year to insure a Tesla.

Driving History: Insurers use your driving history to calculate rates. If you have speeding tickets, at-fault accidents, DUIs, and other incidents on your driving history, then you’ll pay more for car insurance than someone with a clean record. A single at-fault accident could double your Tesla car insurance premiums, increasing average rates to over $8,000.

Age and Gender: Insurers use age and gender to calculate insurance premiums. Older males tend to pay less for Tesla car insurance than older females. This trend flips for younger drivers, with younger females paying less for car insurance than younger males. Depending on your age and gender, you could pay significantly more or less for Tesla car insurance.

ZIP Code: Does your ZIP code have high rates of accidents or vehicle theft? Do you park your car in a locked garage at night or on the street? Depending on where you park your Tesla, you could pay higher or lower rates for car insurance. Insurers use your ZIP Code to determine average premiums.

What’s the Best Insurance Company for Tesla Drivers?

You should be able to buy Tesla car insurance from most major insurance companies in the United States. Today, most insurers offer free quotes to Tesla drivers, making it easy to see how much Tesla car insurance costs with different insurers.

According to our model driver profiles, the best insurance companies for Tesla drivers include:

  1. Tesla Insurance: $3,414
  2. Progressive: $3,665
  3. State Farm: $3,704
  4. GEICO: $3,713
  5. Allstate: $4,545
  6. Farmers: $4,569

Although Tesla Insurance is a popular option, it’s only available in California. Tesla plans to expand their in-house insurance program to other states in the future.

Why Is Tesla Insurance More Expensive?

The average American pays around $1,450 per year for full coverage car insurance. The average Tesla driver, meanwhile, pays around triple that amount. Why is Tesla insurance more expensive?

Several factors increase the cost of Tesla insurance, including:

Expensive Repair Costs: Tesla vehicles have more high-end, proprietary technology inside than an ordinary vehicle. If these parts break, they’re expensive to repair. It costs much more to repair a Tesla than it does to repair a typical gas-powered vehicle.

Higher Values: Teslas are more expensive than other vehicles. With retail costs ranging from $30,000 to $120,000, Teslas are more expensive to insure because they’re worth more than a typical vehicle.

Unibody Construction: While other cars use panels, Tesla is moving towards unibody construction to lower costs. Tesla vehicles tend to have large aluminum panels for better stability and safety. This comes at a cost: if one part of the panel is damaged, then the entire panel may need to be replaced. This can increase the cost of a small claim (like a scratch, ding, or dent) significantly. Insurance companies raise premiums accordingly.

How Does Tesla Insurance Work?

Tesla is the only major car insurance company in the United States that also offers its own in-house car insurance. Today, many Tesla drivers buy insurance through Tesla Insurance.

According to Tesla, drivers can save up to 30% by buying insurance directly through Tesla Insurance. Plus, Tesla Insurance offers comprehensive coverage and claims management.

How does Tesla offer lower rates than competing insurers? Tesla knows its vehicles better than anyone. They know the unique risk factors for each vehicle. They know how much it costs to repair their vehicles. They use data collected by Tesla vehicles to create hyper-customized insurance rates.

By specializing in insuring one specific type of vehicle, Tesla can lower costs and pass big savings onto customers.

Additionally, Tesla offers special coverage options we don’t see with other insurers, including:

  • Autonomous vehicle liability coverage, which protects you against property damage and bodily injury liability when your vehicle is in autonomous driving mode
  • Cyber identity fraud expense, which covers you against digital identity fraud up to $15,000 per incident and $30,000 per insurance period
  • Wall charger coverage, which covers your standard electrical power charger if it’s lost, damaged, or stolen
  • Electronic key replacement, which covers the loss of your electronic Tesla car keys up to $500 for two incidents in each insurance period
  • Loan and lease gap coverage, which covers the gap between the money owing on your lease or loan and the money you receive in a total loss insurance claim

Tesla Insurance is currently only available in California. If you are a Tesla driver in California who needs insurance, then you can purchase a policy in as little as one minute through Tesla Insurance.

Final Word on the Cost to Insure a Tesla

Teslas tend to be more expensive to insure than other vehicles. The average Tesla costs around $4,443 per year to insure.

However, the cost of car insurance varies widely depending on personal factors and your Tesla model. Someone who drives a Model Y, for example, will pay less for car insurance than someone driving a Model X.

Shop around and compare Tesla car insurance quotes today to ensure you’re getting the best possible coverage.

James Shaffer
James Shaffer James Shaffer is a writer for InsurancePanda.com and a well-seasoned auto insurance industry veteran. He has a deep knowledge of insurance rules and regulations and is passionate about helping drivers save money on auto insurance. He is responsible for researching and writing about anything auto insurance-related. He holds a bachelor's degree from Bentley University and his work has been quoted by NBC News, CNN, and The Washington Post.
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