The Best Insurance for Tesla Model 3 (and Why We Love It!)


The Best Insurance for Tesla Model 3 (and Why We Love It!)

When you snag a new Tesla Model 3, you need to be sure you can afford to protect it. Insurance rates seem to be rising all the time, so finding the best rate and package can be a challenge. Here are some of our top choices for insurance for the Tesla Model 3 and the reasons why we rank them highly. 

What is the best insurance for a Tesla Model 3? The top 5 agencies to look into for coverage for your Tesla Model 3 are

  1. Geico 
  2. Progressive
  3. Liberty Mutual 
  4. State Farm
  5. AARP

The average estimated insurance rates for a Tesla Model 3 are nearly $1800 a year for full coverage. High-risk coverage can be more than double that price, at a little over $3800 or more, and of course, teenagers will end up paying more than $6200 annually on average. Your estimates will vary based on location, driving habits, age, and more, so here’s a synopsis on the best insurance options for your Tesla.

Why You Need Insurance: Common Problems With the Tesla Model 3

First and foremost, congratulations on your new Tesla Model 3! Rumor has it that these vehicles were originally intended to be an electric vehicle suitable for the masses; however, as development continued, it became more of a luxury alternative to compact sedans. Because of this, this vehicle is only available by special order at a price comparable to BMW and Mercedes cars. 

Tesla is one of the greatest automotive innovations of our time. With cutting edge technology like the ability to self-drive and a completely electric system, this vehicle is on the frontlines of safer driving and eco-conscious travel. 

However, because it is breaking such new ground, the Tesla Model 3 is prone to manufacturing errors that can lead to some pretty dangerous driving situations. Despite the debut of the Tesla Model 3 and a promise for more reliable manufacturing, every single one of the early Tesla Model 3 owners has reported problems with their vehicles. 

Some of those problems included a blurry backup camera, defects of the doors, window, and trunk, failure of the touchscreen (which is needed to adjust cruise control while driving and many other vital automotive functions), and moreSince some of these issues can cause distraction or negatively impact the safety of driving, you need to make sure you have reliable insurance in the case of malfunctions.

Choosing Insurance for Your Tesla Model 3

A recent analysis of insurance rates for the Tesla Model 3 showed that not only is this vehicle worth a good chunk of change, but so is protecting it. The average price of an insurance package for this vehicle can range from as low as $388 to over $6000 a year – the price is dependent on you, your preferences, driving habits, location, and how much of a “risk” you are to ensure. 

(High-risk drivers can be defined in a number of ways. At times, it is simply a relative term: one driver posing more risk than another or referring to a driver being ineligible for the insurance they prefer. It also refers to someone who has either been in an accident that resulted in one or more deaths or who has accumulated several minor offenses.)

The average annual premium for full coverage was estimated to be $1,762, while comprehensive coverage alone was found to be $424, collision $870, and liability $332. High-risk drivers came in at $3,838, and teenagers at a whopping $6,242. Between rural areas and large metropolitan cities, the price varied from $1,322 to $2,379 – so remember to factor in your zip code!

When choosing your insurance package for your Tesla Model 3, these estimates can easily make the process seem overwhelming and hopeless. But don’t worry! There are ways to reduce the price, and you may even determine that full coverage is not necessary. Having safe driving habits, healthy credit, and the ability to pay small claims out of pocket can keep your premiums down. 

The Best Insurance Options for the Tesla Model 3

Surprisingly, when compared to the Tesla Model S and the Tesla Model X, the Tesla Model 3 is the cheapest of the bunch to insurance – well, it can be. Because the base car price is lower than the other two, that reduces the insurance premiums right out off the bat. When comparing the top contenders for the best prices for insuring your new Tesla Model 3, the following make the top 5:

  1. Geico
  2. Progressive
  3. Liberty Mutual
  4. State Farm
  5. AARP

Although they are not all available to drivers in all 50 states (AARP is available only to drivers outside of AK, HI, LA, MI, and RI), each of these agencies offers discounts to safe drivers, accident forgiveness, and new car protection. 

1. Geico

As our little Geico Gecko friend tells us (probably) every day, Geico is truly one of the best insurance options for you and your vehicle. This insurance is offered in all 50 states with optional roadside assistance and flexible pay schedule (either 6 months or 12 months). 

Drivers can choose to either make their claims online or by phone if necessary, and Geico also offers both new car protection and accident forgiveness. Geico is also very generous when it comes to discounts – which is exactly what you want when it comes to your Tesla. They offer the following:

  • Anti-theft device discount
  • Bundling discount
  • Defensive driving discount
  • Good student discount (up to 15%)
  • Loyalty discount
  • Military discount
  • Safety device discount (up to 15%)
  • Special employment discount
  • Seat belt use discount (up to 15%)

There are also multiple coverage options as well including rideshare, SR-22, and temporary and/or short-term coverage. 

Geico’s offers seem a little too good to be true, don’t they? Well, believe it! When it comes to insuring your Tesla, you’re going to need to find as many options for reducing your rates as possible. That includes the agency you choose, your driving habits, and then some. Taking advantage of Geico’s plentiful discount offers can help you out. 

The only two things to note about Geico, however, is that the agency does have relatively low online customer service reviews and that claims are, more often than not, handled online. If you don’t think these will be issues for you, then go ahead give Geico a call.

2. Progressive

Progressive offers an insurance package that is very similar to that of Geico in that it is available in all 50 states, with optional roadside assistance, payable on a 12- or 6-month basis, offering both new car protection and accident forgiveness. Claims made through Progressive can also be made online or by phone. 

Progressive offers a healthy assortment of discounts as well:

  • Anti-theft device
  • Bundling (5% for auto insurance, depending on bundle)
  • Defensive driving
  • Good student
  • Homeowner
  • Military 
  • Safety device
  • Usage-based

This agency will provide coverage for rideshare and SR-22, but will not, however, offer temporary and/or short-term coverage (unlike Geico). So, unfortunately, if you are only in need of a short-term policy, Progressive will not be the right choice for you. Still, Progressive drivers are said to save up to $699 annually (based on a national survey of Progressive customers). 

The great thing about the discounts offered by Progressive is that they are applicable to many different age groups – young adults can save a bit of money with the Defensive Driving and Good Student discounts, and adults or elders can accumulate a Usage-Based and/or Homeowner’s discount. Progressive’s Safe Driver discount is also slightly higher than Geico’s at 30% (Geico’s is 26%). 

3. Liberty Mutual

In terms of discounts, Liberty Mutual falls right alongside when comparing Safe Driver rates (neck-and-neck as Liberty Mutual is at 30% as well). This agency, again, is similar to both Progressive and Geico regarding its benefits. Liberty Mutual is available in all 50 states with optional 24-hour roadside assistance, offering both new car protection and accident forgiveness. 

Claims can be filed online and by phone, and you can expect to pay a monthly rate for 12-month agreements. Somehow, despite the tons of discounts offered by the two previous agencies, Liberty Mutual provides even more than that!

  • Anti-theft device
  • Bundling discount
  • Defensive driving
  • Good student
  • Loyalty
  • Safety device
  • Special employment
  • Usage-based
  • Newly-married

The good thing about the newly married discount is that it takes into account that, for many people, the first time they purchase and insure a brand-new car on their own is after the big day. If that’s your case, you’ve got a leg-up on saving on protecting your Tesla, especially if you are (or will be) a student as well. 

Liberty Mutual covers all their bases coverage – similar to Progressive, they offer coverage for rideshare, SR-22, and temporary and/or short-term coverage. Additionally, when you get a quote online, Liberty Mutual offers an instant 12% or more off of your premium. The cons of Liberty Mutual, though, are in its inconsistency: you’re not guaranteed to get the best prices, and the coverage minimums vary by state.

4. State Farm

State Farm is surely the most flexible insurance option in the top 5 due to its many options for filing claims and 6-month agreements. Insurance is available through State Farm in all 50 states with optional 24-hour roadside assistance, new car protection, and accident forgiveness. 

Available methods by which to file claims is one of its strong points as well, as it enhances the customer experience through accessibility. Drivers can file claims with State Farm online, through email, by phone, or in person. Being the most flexible doesn’t necessarily mean the cheapest, though. 

State Farm doesn’t offer nearly as many discounts as Geico, Progressive, and Liberty Mutual, and some of their discount options have a relatively low cap (when compared to the Safe Driving Discount offered by competitors). The safety device discount makes up for what the others lack, however.

  • Anti-theft device
  • Bundling
  • Defensive driving
  • Good student (up to 25%)
  • Loyalty (up to 20%)
  • Safety device (up to 40%)

Ultimately, although State Farm doesn’t have the variety of discounts that the others do, this agency is more accessible to younger drivers, given its availability and short agreement terms. The Good Student can particularly be a tremendous help to those Tesla Model 3s that are going to a teen driver. 

5. AARP

AARP is best specifically for elders who own a Tesla Model 3, given its rewards offered to customers age 50 and above. The average AARP customer is said to save approximately $449 every year based on a 2018 survey. 

Reviews for this agency are all over the map, however. The star ratings for AARP range from 1.2 out of 5 to 3 out of 5, so if you’re forte for auto insurance is a consistently positive customer experience, you can probably bet against that if you opt for AARP. 

The AARP acronym stands for the American Association of Retired Persons, so keep in mind that the 50+ age group is their primary consumer base – your 16-year-old probably won’t be able to get coverage through AARP. 

Their offered benefits and bonuses are crafted around the needs of their primary consumer base: they offer a “disappearing deductible” (amount of deductible decreases every year with good driving), accident forgiveness, and 12-month agreements. 

How to Choose the Best Auto Insurance

Now that you’ve seen all of the best options available to you, there are a few ways you can go about getting quotes. If you’ve already decided on the agency you want to go with, you can choose to either head to their website, call them, or visit the nearest office to get your plan started. It’s important to get quotes directly from the insurance agency, because, again, rates can differ based on your location. 

Choosing an insurance agency and policy will be a bit trickier if you are unsure of what agency to go with, which is what most people face when buying a new car. Some of the first things to consider are how you will be using your Tesla Model 3. Do you intend to use it only for commuting to and from school or work? Is it a cruiser meant for only the weekends? 

For those who use their vehicles daily or at least 3 times during the week, you may want to consider getting a full coverage policy. The more often you drive your car, the greater chance you have of getting into an accident (since you will be on the road more often and for longer periods). 

Also – you need to be honest with yourself: are you a speedy driver? Know your own driving habits – as previously mentioned, high-risk drivers do not have the same level of accessibility to good insurance rates as others do. Being aware of your driving habits will help in knowing whether you should be looking for special discounts and which ones you qualify for. This may help your wallet in the long run.

Different Types of Auto Insurance Policies

Another thing to factor into the process of choosing an auto insurance policy is your priority: Are you seeking auto insurance because you have a particular, valid reason to need protection (driving on unpaved roads often, concerned about issues reported with Tesla Model 3, etc.)? Or do you not care so much about roadside assistance or collision, for example, but more about the discounts?

Keeping your priorities in mind will help you to narrow down your choices further when it comes to choosing your agency and policy. The different portions of your policy (in the context of full coverage) are

  • Liability: This covers any damages you may cause to others in an accident. There are two different types of liability, one of which covers bodily injury and another that covers property damage. You can, of course, choose to cover both – especially if you will be carrying valuables in your Tesla. 
  • Collision and comprehensive: This covers the Tesla. In the event of an accident, the collision and comprehensive coverage will cover the damage to your Tesla Model 3 and intentional damage such as theft or vandalism. (This is why there are discounts offered to anti-theft and safety devices, as an added incentive to better protect your Tesla). 
  • Personal injury protection: This one will be of particular importance to handicapped and/or older drivers because this portion covers possible medical expenses that may arise from accidents. It also covers lost wages and other fiscal impacts of accidents. The catch is that this is only available for scenarios in which you were not at fault. 
  • Uninsured motorist: This covers both bodily injury and property damage in the event that you are in an accident with an uninsured or underinsured motorist. Of course, you must not be at fault for this as well. 

Choosing insurance can seem like an overwhelming task at first, but after you take a step back and evaluate your needs based on your driving habits, the process can become very straight forward. Keep in mind what you are looking for in owning your new Tesla Model 3, and build your insurance needs from there. 

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Greg

Hi, I'm Greg. My daily driver is a Tesla Model 3 Performance. I've learned a ton about Teslas from hands-on experience and this is the site where I share everything I've learned.

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