Tesla Reduces Insurance Costs for FSD Drivers

As Tesla’s Full Self-Driving (FSD) technology shows fewer major interventions, the company is laying the foundation to persuade regulators that its autonomous driving system is safer than human drivers.

Safety Comparisons

Elon Musk has mentioned that FSD has an 8x safety benefit, although this figure is based on older NHTSA data. In contrast, Tesla’s own statistics indicate that FSD and Autopilot result in 6x fewer accidents when compared to traditional manual driving.

Insurance Discounts

Tesla is taking a careful approach, only offering its insurance in a few states. Musk is so confident in the safety of FSD compared to human driving that Tesla is now providing discounts on insurance premiums, which increase based on the number of miles driven using FSD.

Starting in Texas and Arizona, new policyholders can expect reduced insurance costs this month, or starting March 8 for those renewing their policies. The process involves Tesla tracking the total miles driven each month and calculating the percentage of those miles driven while FSD was active.

Incentives for FSD Use

The greater the percentage of miles driven using FSD, the larger the discount, which could encourage drivers to utilize FSD more often instead of manual driving. To qualify for the discount, a driver must log at least five miles or 1% of their total miles using FSD within a 30-day timeframe.

If a Tesla operates on FSD for half of the time, the company will reduce the insurance premium by 10% on the next payment. However, this offer is exclusive to those who have either purchased FSD or are monthly subscribers, and it does not apply to new owners currently in their free 30-day FSD trial. Additionally, certain aspects of the policy, like comprehensive insurance or coverage for uninsured drivers, are excluded from the FSD discount, meaning the total savings might be lower.

Although Tesla’s insurance offerings are limited to a few states and may not be the best option overall, the clear goal is to have FSD influence a driver’s safety rating for insurance purposes, and to showcase such a discount program to regulators.

Future Plans

Tesla is gearing up to introduce unsupervised FSD in Austin this June, and it will need all the positive regulatory support it can get to broaden its robotaxi service in more significant cities by the year’s end.

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