Tesla Car Insurance: Compare Rates by Model

Tesla offers its own auto insurance program, which drivers can purchase through the Tesla app in just a few clicks. Tesla’s coverage is usage-based, which means your premiums are based on your driving behavior. Safer driving leads to lower premiums.

At the moment, Tesla’s plans are only available in 12 states.

Tesla owners pay more for car insurance on average, given their cars’ high repair costs. We’ll explore Tesla’s in-house insurance coverage in more detail and see how it compares to more traditional auto insurance companies.

You’ll find all the information you need to get an affordable rate on your Tesla car insurance policy with our latest guide.

Key Takeaways:

• Dairyland, Clearcover, and Nationwide offer the lowest average rates for insuring a Tesla.
• The Tesla Model S comes with the highest average insurance rates.
• Tesla’s in-house insurance program doesn’t factor in credit score when determining rates, but many companies do.

Cheapest Tesla Car Insurance Rates

If you’re looking for the best deal to insure your Tesla, you’ve come to the right place. Below are the five cheapest companies for Tesla vehicles, regardless of model, according to Compare.com data.

Dairyland offers the cheapest average rates of any company when it comes to insuring a Tesla. Its average premiums are more than 10% cheaper than the next most affordable option, Clearcover.

But these rates are broad averages and aren’t always a good indicator of what you’ll actually pay. After all, car insurance companies use a wide array of factors when calculating rates, and things like your age, location, driving record, and even credit score can all play a big role.

The best way to find the best deal for your unique situation is to compare quotes from multiple companies.

The Cost of Tesla Car Insurance by Model

If you think the rates above seem high, you’re not alone. Teslas are some of the most expensive vehicles to insure of any brand on the market today. But that’s a common trait for electric vehicles, says Loretta Worters, vice president of media relations for the Insurance Information Institute.

“Teslas, like other electric cars, are more expensive to insure because replacement parts cost more than in gas cars,” explains Worters. “The battery alone can cost anywhere from $13,000 to $20,000, and the technology is more sophisticated than in a gas car, which adds to the cost of repairs.”

Generally, your car insurance rates will vary based on the specific Tesla model you drive. In the sections below, we’ll walk you through how much drivers of each Tesla model can expect to pay for insurance.

Model 3

The Tesla Model 3 is the brand’s midsize sedan, seating up to five people. Model 3 drivers can travel up to an EPA-estimated 333 miles on a single charge (for 2023 models). The Model 3 RWD’s MSRP of $40,240 makes it one of Tesla’s more affordable offerings (the Model 3 Performance comes in at $53,240).

But despite its affordable MSRP, insurance rates are still on the high end for a Tesla, with drivers paying an average of $97 per month for liability-only insurance for their Model 3.

The table below shows how much Model 3 drivers pay for insurance, according to Compare.com data. Nationwide offers the best price for full-coverage insurance at an average of $150 per month.

Model Y

The Tesla Model Y is a midsize SUV that is slightly larger than the Model 3 and gets an EPA-estimated 330 miles on a single charge. The car has a base price of $47,490, which is slightly more expensive than the Model 3.

But despite the higher MSRP, the Model Y comes with cheaper insurance premiums on average, at $92 per month for liability-only policies and $224 for full coverage.

The table below shows how much it costs to insure the Model Y on average, according to data from Compare.com. Model Y drivers who purchase insurance from Mercury pay the lowest premiums on average, at $195 per month.

Model S

The Tesla Model S is a luxury four-door sedan that can travel 396 miles on a single charge — the best mileage of any Tesla model. Drivers pay for this power, as the Model S starts at $88,490 (the Model S Plaid is $108,490).

The Model S is also the most expensive Tesla to insure, with drivers paying an average of $282 per month for full coverage.

The table below shows how much the average Model S driver pays for insurance, according to Compare.com data. Elephant Insurance offers the best value for Model S insurance, with customers paying an average of $164 per month.

Model X

The Tesla Model X is the company’s other SUV offering, equipped with up to seven seats and 92 cubic feet of cargo space. Model X owners can drive 348 miles on a single charge (for the standard Model X). Despite being Tesla’s most expensive vehicle, with a $98,490 base MSRP, the Model X has slightly lower car insurance premiums than the Model S, at $271 per month for full coverage.

Here’s how much Model X drivers should expect to pay for car insurance, based on Compare.com data. Mercury has the lowest average cost for Model X insurance, with average premiums at $130 per month.

How Tesla Car Insurance Works

Tesla offers some of the most advanced vehicles on the roads — and the growing electric car brand took that approach to the insurance industry when it launched its own auto insurance program in California in 2019. Though the company plans to expand the program nationwide (CEO Elon Musk previously said Tesla Insurance would be “in most of the U.S.” by the end of 2022), it’s currently available in just 12 states.

Tesla Insurance differentiates itself from competitors by using driver behavior to determine rates (except in California). Unlike other insurance companies, Tesla Insurance doesn’t use age, credit score, gender, or marital status to calculate your rate. Tesla also claims that your premium won’t increase after accidents or traffic violations.

Other usage-based car insurance programs require you to install a device in your car or an app on your phone in order to track your driving, but Tesla uses features already in your car to assess driving behavior. Tesla claims your driving data will only be used to calculate your Safety Score, which can influence your final rate each month.

Understanding Tesla’s usage-based insurance model

Tesla Insurance uses software in your Tesla vehicle to collect real-time driving data, which is then used to calculate your Safety Score. Your Safety Score is a number from 0 to 100, with safer drivers earning higher scores. The higher your score, the lower your premiums.

Hard braking, aggressive turning, excessive speed, unsafe following, or unbuckled driving are just a few of the factors that affect your Safety Score. How much you drive and whether you drive late at night (which is considered high-risk) also affect your score.

“If you’re a good driver, usage-based insurance could save you money,” says Worters. “Even small changes, like cutting down on speeding or taking fewer harsh turns, can lower your costs.”

At the end of each trip, you’ll receive driving feedback and an updated score. You can even see an estimate of next month’s premium based on your current score. At the end of each month, your new premium is determined based on a mile-weighted average of the daily Safety Scores you’ve received over the past 30 days.

Data collection and privacy concerns

Tesla states that your driving data will only be used to calculate your Safety Score. The company won’t monitor your location, track where you’ve driven, or sell your vehicle data to anyone for any purpose. In short, your data stays with you. Tesla’s extensive privacy policy outlines its commitment to responsible data use.

Tesla car insurance availability and expansion plans

Tesla is currently available in the following states:

• Arizona
• California
• Colorado
• Illinois
• Maryland
• Minnesota
• Nevada
• Ohio
• Oregon
• Texas
• Utah
• Virginia

Tesla drivers in California receive a Safety Score “for educational purposes,” but state law doesn’t allow Tesla to use this score to determine your insurance rates.

The company has indicated that it hopes to eventually offer its insurance products in all 50 states. But the sale of Tesla vehicles still isn’t allowed in all 50 states (due to its unique “direct to consumer” business model), so full nationwide expansion could take a while.

Pros and cons of Tesla Insurance

Wondering if Tesla Insurance is right for you? Consider these pros and cons.

Pros:

• Can sign up in just a few minutes
• Easy-to-use interface right in the Tesla app
• Promotes safe driving

Cons:

• Only available in 12 states
• Some drivers might not want Tesla tracking their driving
• More expensive than competitors

How Tesla Car Insurance Stacks Up Against Competitors

Tesla Insurance is taking on established insurance providers head-on. But whether you should purchase insurance from Tesla or a standard insurance company depends on your needs.

For instance, purchasing Tesla Insurance might be a good idea if you’re looking for an easy-to-use, app-based program, are interested in usage-based insurance, or want regular updates on how safely you’re driving.

Meanwhile, traditional insurance companies — such as Allstate, Progressive, and GEICO — come with their own advantages. These industry veterans offer years of customer service experience and proven financial stability. If you value experience and prefer to work with an agent over the phone or face-to-face rather than through an app, a standard insurer may be your best option.

Most major insurance companies offer usage-based insurance programs, such as Allstate’s Drivewise program and Progressive’s Snapshot. These programs differ from Tesla Insurance because they require you to install a separate device or use an app to track your driving.

Tesla Car Insurance FAQs

Want to learn more? Here are answers to some of the most commonly asked questions about insuring your Tesla.

Which companies offer the cheapest insurance for a Tesla?

Dairyland, Clearcover, and Nationwide offer the cheapest car insurance policies for Tesla drivers. Dairyland’s rates are just $134 per month, the lowest of any insurer. Your rates will vary based on the model you drive, your age, your gender, your driving record, and your ZIP code.

Why are Teslas more expensive to insure?

Tesla is one of the more expensive car brands on the market, with their most expensive models costing more than $100,000. Naturally, expensive cars have higher maintenance and repair costs. Car insurance companies account for these steep repair costs by charging Tesla drivers higher premiums.

How much is insurance on a Tesla per month?

How much insurance costs for your Tesla will vary based on the model and your unique circumstances. Liability-only insurance premiums fall in a range from $92 per month for the Tesla Model Y up to $99 per month for the Tesla Model S. Full-coverage policies are over $200 per month on average, depending on your model.

Does Tesla pay for insurance?

While Tesla won’t pay for your car insurance, it does offer a car insurance program through its app. Tesla’s insurance is usage-based, which means your premiums are determined each month based on your driving habits.

Do you need insurance to drive a Tesla?

While insurance requirements vary from state to state, you’ll need proof of insurance in order to drive legally in the United States. Most states require a minimum amount of liability insurance to hit the road. These rules apply the same way to Tesla drivers, who must be insured.

How can you get a Tesla Car Insurance quote and sign up for a policy?

Tesla claims that drivers can receive an insurance quote in one minute through the Tesla app. Current Tesla owners can simply tap their profile picture icon in the upper-right corner of the app then select “Get Insurance.”

How do you file a claim with Tesla Car Insurance in case of an accident or damage?

Tesla makes it easy to file claims right in the Tesla app. Just open the app, click on your profile picture, and tap “Account” > “Insurance” > “Manage” > “Claims.” The app will guide you through the claim-submission process. Tesla suggests filing a claim right at the scene so that you can submit photos of any damage to your vehicle.

How much is full-coverage auto insurance on a Tesla?

Your auto insurance policies will vary based on the Tesla model you drive. Model Y drivers pay the lowest average premiums for full-coverage insurance, at $224 per month, while Model S drivers pay the highest average full-coverage rates, at $282 per month. Model X and Model 3 average rates fall in this range.

Methodology

Data scientists at Compare.com analyzed more than 50 million real-time auto insurance rates from more than 75 partner insurance providers in order to compile the quotes and statistics seen in this article. Compare.com’s auto insurance data includes coverage analysis and details on drivers’ vehicles, driving records, insurance histories, and demographic information.

All the quotes listed in this article have been gathered from a combination of real Compare.com quotes and external insurance rate data gathered in collaboration with Quadrant Information Services. Compare.com uses these observations to provide drivers with insight into how auto insurance companies determine their premiums.

Sources

1. Insurance Information Institute. “What determines the price of an auto insurance policy?” Accessed July 23, 2023.
2. S&P Global. “Tesla’s Musk, others take aim at Calif. law restricting telematics.” Accessed July 23, 2023.
3. Newsweek. “Tesla Insurance Adds 3 More States, Plans to be Nationwide This Year.” Accessed July 23, 2023.