Lemonade Launches Cheaper Automotive Insurance coverage for Tesla FSD

Lemonade says it will reduce per-mile insurance rates by about 50% for Tesla drivers when Tesla’s Full Self-Driving (FSD) system is engaged, utilizing car telemetry to differentiate between human-driven and FSD-driven miles. The insurer described the providing as “Autonomous Automotive Insurance coverage,” constructed on its pay-per-mile mannequin.

Lemonade’s collaboration with Tesla offers the insurer entry to detailed telemetry that permits it to cost miles otherwise relying on whether or not FSD is steering. Lemonade says the discounted fee displays knowledge indicating a decrease accident fee throughout FSD operation.

The rollout is anticipated to begin with Tesla drivers in Arizona, adopted by an growth to Oregon, in keeping with varied commentators. Some folks highlighted that Tesla’s FSD is classed as a Stage 2 driver-assistance system, which nonetheless requires driver supervision, and notes that the know-how has confronted regulatory scrutiny associated to security issues.

The transfer underscores how insurers are beginning to rethink pricing as superior driver-assistance techniques turn into extra extensively used. As an alternative of treating all miles the identical, Lemonade is successfully separating “human miles” and “software-assisted miles,” and assigning completely different per-mile charges primarily based on how the car is being operated.

This improvement aligns with predictions made years earlier (2016+) by technologists and insurance coverage researchers who argued that superior driver-assistance and autonomous techniques would ultimately drive insurers to cost threat primarily based on software-controlled miles fairly than human habits.

As early because the mid-2010s, a number of business analyses recommended that as automobiles gained the flexibility to differentiate human-driven and system-assisted driving, insurance coverage pricing would shift towards usage- and mode-based fashions, with decrease premiums for miles pushed underneath automated management. The Lemonade–Tesla program displays that long-anticipated transition from driver-centric underwriting to software-aware insurance coverage pricing.

Filed in Transportation. Learn extra about Self-Driving Cars and Tesla.