Tesla Insurance has reportedly revealed its Q4 2022 results which indicate that the business is growing.
Tesla’s safety score system, which utilises driving data collected in real time from Tesla vehicles to determine is the user is a “good driver” based on factors such as hard braking and unsafe following distance.
Tesla’s insurance uses data based on an individual’s driving behaviour to set rates, a safety score between 0 and 100 is then calculated. Customers can see their score on the Tesla app.
The company said its premiums can deliver savings of 20% to 30%. For the average driver who is getting a Tesla safety score, the savings can run between 20% to 40%, and for the safest drivers, Tesla said the savings could be between 30% to 60%.
According to a report from Coverager, Tesla held an earnings call to discuss its Q4 results.
Tesla Insurance, which is currently available in 12 states, is at $300m annual premium run rate as of the end of 2022.
The business is growing 20% a quarter, which is faster than the growth of its vehicle business.
In addition, 17% of Tesla customers in states where insurance is available have signed up for Tesla Insurance. This figure reportedly continues to climb.
During the call, Kirkhorn also reportedly said that the main priority of Tesla’s insurance business was and still is to improve the total cost of ownership of the vehicles. He added that the company looks to run a “healthy business” while keeping costs low and insurance affordable to customers.
Musk added that this strategy makes other car insurance companies offer more competitive rates for Teslas. He also mentioned that the company adjusted the design of the car and made changes in the software of the car to minimise the cost of repair.
Last year, FinTech Global reported on the roll-out of Tesla’s data insurance product, to discuss how the venture may fare. The launch is well underway in the US, promising its safe-driving customers up to 60% off their premiums, and freedom from being judged by conventional underwriting factors such as age and gender.
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