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Tesla wants to sell future cars with insurance and maintenance included in the price

Feb 23, 2017, 20:58 IST

The Tesla Model S P85D won the highest rating Consumer Reports has ever awarded.Johannes Eisele/AFP/Getty Images

Tesla wants to bundle insurance and maintenance into the price of future vehicles.

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Tesla has actually been quietly experimenting with this model in Asia by selling cars with insurance and maintenance included, Jon McNeill, Tesla's president of sales and services, said during the company's fourth-quarter earnings call.

"It takes into account not only the Autopilot safety features but also the maintenance cost of the car," McNeill said. "It's our vision in the future we could offer a single price for the car, maintenance, and insurance."

There's been some discussion regarding how insurance models could change if cars are getting safer with self-driving features. The general thought is if self-driving cars reduce the number of collisions, there should be a reduction in the risk premium.

Insurers like Cincinnati Financial, Mercury General, and Travelers have noted in SEC filings that driverless cars could threaten their business models, according to a 2015 Bank of America and Merrill Lynch report.

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The National Highway Traffic Safety Administration found that crash rates for Tesla vehicles have plummeted 40% since Autopilot was first installed.

"If we find that the insurance providers are not matching the insurance proportionate to the risk of the car then if we need to we will in-source it," Tesla CEO Elon Musk said on the earnings call. "But I think we'll find that insurance providers do adjust the insurance cost proportionate to the risk of a Tesla."

Electrek reports that Tesla has partnered with AXA General Insurance for its program InsureMyTesla. In Australia, Tesla has partnered with QBE Insurance on the insurance plan.

NOW WATCH: Elon Musk came up with an ingenious solution to a Tesla owner's Twitter complaint in just 6 days

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