The EV Car Insurance Business

[Rivian_Hugh_III]

Here are the first three paragraphs of the CNBC article on EV’s and insurance:

"For consumers who have found that costlier insurance is just one of the expenses that make electric cars trickier to love, this is the year when relief may be coming.

"Tesla says its company-backed insurance, now on the market in just five states, may reach 45 by the end of the year. GM, which revived its old GMAC insurance unit as OnStar Insurance in 2020, says it hopes to hit $6 billion in yearly insurance revenue by decade’s end.

"Auto insurance is unlikely to ever be the largest business at either company, or even close. But insurance is shaping up as a way that the finance side of automakers’ business can help drive innovation and make adoption easier – as the data generated by the cars themselves is captured to deliver lower insurance prices and, automakers hope, cement customer loyalty.

https://www.cnbc.com/2022/02/19/why-tesla-and-gm-want-to-be-big-in-the-car-insurance-business.html

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[r1t_kev]

data generated by the cars themselves is captured to deliver lower insurance prices

Or higher prices, as the case may be. ? ?

 

[sub]

Or higher prices, as the case may be. ? ?

If you are that sort of driver, you might have to deal with a big rate hike either way.

If the low risk drivers switch to manufacturer insurance because their driving habits make that product cheaper for them, then traditional 3rd party insurance companies would be forced to raise their rates. With the low risk drivers gone, the average risk and therefore the price has to go up.

 

[CommodoreAmiga]

Call me cynical, but I expect the data to be used to raise rates more than it's used to lower them.

Even if it may lower rates somewhat for some people, I expect more will experience a greater increase.

 

[Rivian_Hugh_III]

Call me cynical, but I expect the data to be used to raise rates more than it's used to lower them.

Even if it may lower rates somewhat for some people, I expect more will experience a greater increase.

To be fair, it will lower rates for people who drive 10 miles a day, at 5 under the speed limit, giving 3 seconds lead to the car in front of them, and making full stops at every stop sign. For you and I? Yeah, we're screwed.

 

[sub]

To be fair, it will lower rates for people who drive 10 miles a day, at 5 under the speed limit, giving 3 seconds lead to the car in front of them, and making full stops at every stop sign.

Those people are all 90 years old, have declining vision and possibly declining mental capacity. Their rates are (or should be) on an upward trajectory as well.

 

[NY_Rob]

To be fair, it will lower rates for people who drive 10 miles a day, at 5 under the speed limit, giving 3 seconds lead to the car in front of them, and making full stops at every stop sign. For you and I? Yeah, we're screwed.

.. as I explained to my insurance agent after we discussed several incidences of "hard braking" from the driver report taken from my 2017 Bolt "it's NY.. if I wasn't hard braking I wasn't driving.. it's part of everyday driving here". Funny thing is, since it's a locally owned independent insurance office, they actually agreed with me.

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