It seems that Tesla’s automobile owners are going to be paying a lot more in terms of insurance since a recent wave of attacks on Teslas has begun. Despite already having higher premiums than most electric cars, Teslas could become more costly to insure if such occurrences continue.
A Growing Backlash
The rates of attacks on single vehicles and entire showrooms, besides charging stations and even Model 3 vehicles, have risen in the last few weeks. This seems to be related to the increasing criticism of Tesla and CEO Elon Musk and his affiliation with Dogecoin (DOGE). It appears that there have been situations when the owners of Tesla cars painted their cars, threw eggs at their cars, or even shot them with various objects, which caused numerous calls.
Amongst these are two Cybertruck owners who suffered major damage to their cars while driving through a Mardi Gras parade in New Orleans when some objects were thrown at them. Apart from individual attacks, Tesla stores and charging stations have been damaged or, in the worst-case scenario, damaged by gunfire and suspected arson attacks.
A recent event in France, which was an arson attack, has contributed to such feelings. Twelve more Tesla cars were torched in a deliberate attempt, whereby every car was a Tesla; the overall cost of damage was determined to be around $750,000. It is a part of the string of attacks that are being directed at Volkswagen officials, and authorities are yet to determine the cause.
This attack is perhaps one of the worst episodes of Tesla car vandalism to date, leaving many to wonder if a similar scale of events might be compensated by an increase in premium rates for Tesla owners around the world.
Impact on Insurance Rates
Before the upsurge in recent days, it was already evident that electric cars, especially Teslas, were rather expensive to insure. According to Bankrate’s findings, the costs of full coverage insurance on the Tesla Model 3 in March 2024 were $3,495 every year, whereas in January they were $3,394. However, insuring a Model Y costs an average of $3,771, and the Model X reached $5,459, more than $300, compared to December last year.
However, the national average car insurance cost is $2,678 implying that Tesla’s insurance costs are relatively higher and above competitors like the Chevy Bolt, Toyota Highlander Hybrid, and Ford F-150 Lightning. For instance, Model Y’s current premium costs are 29% higher than they were a year ago, while Model 3’s premium costs are 24% up, and the average premiums for automobiles in the US are only 10% higher.
Potential for Even Higher Premiums
Although insurance premiums are normally congruent with past experiences and not with the tendencies to occur at the moment, experts claim that the constant wave of vandalism may further skyrocket Tesla insurance prices. Bankrate insurance analyst, Shannon Martin, opined that the current rises may be more related to 2024 claims and the wave of vandalism may start rate uplift from late this year to early 2026.
“I would expect if this keeps happening at this rate, definitely by 2026 renewals, people will start seeing a change, maybe as soon as toward the last quarter of 2025,” Martin told Business Insider.
She compared it to what became known as the “Kia Boys” theft wave of 2023, where insurance service providers either inflated or entirely withdrew coverage for Hyundai and Kia models due to their susceptibility.
Why Are Teslas So Expensive to Insure?
However, even before the increase in the recent wave of some cases of car vandalism, the insurance costs for Tesla cars were relatively high, attributed to the advanced tech incorporated in the cars. Furiously, Martin stated that Tesla models include many more cameras and computer chips than most of the electric models of automobiles, including many small damages that cost much to repair.
“Tesla has a lot more cameras, a lot more computer chips than most other electric vehicles on the market,” Martin explained. “They have cameras not just on the inside of the vehicle but also on the outside of the vehicle. So even a small fender bender would create very expensive repairs for the Tesla owner and the insurance company.”
Despite the effort to rectify the high insurance cost through the introduction of Tesla Insurance in 2019, it is uncertain whether the company’s direct insurer can offset the effects of high vandalism-related claims.
