Experts warn Tesla owners could face skyrocketing insurance rates due to concerning trend: 'The most expensive EV to insure'

Car insurance rates for Tesla owners may climb higher if the electric vehicles continue to be targeted for vandalism.

What's happening?

The automaker is flagging, with spiraling sales and a struggling stock. "It is hard to decouple the company's sudden decline with [CEO Elon] Musk's role in the Trump administration," Newsweek reported, noting Tesla dealerships, charging stations, and EVs have been targeted by protesters.

"While owners are trying to protect themselves with stickers saying they bought their cars 'before Elon went crazy,' increasing vandalism against Teslas, experts warned, could quickly drive up insurance for the already-expensive vehicles," the outlet stated.

Newsweek reported that EV insurance rates rose 28% in 2024, twice as much as insurance for gas-powered vehicles. So while demand for Teslas is decreasing, that doesn't mean insurance costs are.

Why is this important?

Newsweek, citing Bankrate analyst Shannon Martin, noted that full coverage for a 2023 Model 3 cost $3,495 per year in March compared with $2,678 for a Toyota Camry. A BMW i4 cost $3,792, while Model X and Model S Plaid rates were "much higher."

Insurify data journalist Matt Brannon told Newsweek that the Model 3, Model Y, and Model X were "the most expensive EV to insure as of February." A Cybertruck reached $3,813. Last year, Model 3 insurance climbed 30% to $4,362, 25% more than a "comparable Mercedes Benz A-Class."

While Tesla is considered a luxury brand, these figures cut into the savings that EV drivers can expect to bank: $1,500 a year on gas and maintenance (no oil changes; fewer total parts that could need replacing) compared with gas-powered vehicles. Federal, state, and dealer incentives can exceed $15,000.

What's being done about rising Tesla insurance rates?

InsideEVs noted that the solution, at least in the eyes of activists, is for Tesla owners to sell their cars. Otherwise, "not much" can be done, it said.

The used EV market is booming, however, so Tesla drivers can look to sell their rides if they want to explore other options. The Recurrent platform can even connect owners, shoppers, and dealers, helping sellers make $1,400 more on average.

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