Tesla cars are most expensive to repair but their insurance claims match newer gas vehicles
Insuring a Tesla vehicle is not cheap, as many an owner would attest, and a recent study by parts supplier and insurance provider Mitchell sheds a light on the reasons.
It turns out that Teslas command the highest average claim among all brands and propulsion systems. The average EV cost $6,236 to repair in the US last year, and Teslas go even higher, with the Model Y and Model 3 notching the bulk of the EV claims.
Mild hybrids, on the other hand, which are the cheapest to repair, cost US insurers $4,726 per claim on average in 2024. That is not the situation with plug-in hybrids, whose average claim severity is quite high at $5,583.
While many Tesla owners who have gotten wild repair quotes for simple things like a bumper job would argue that these numbers are lowballing the true repair costs, it must be said that these are simply claims averages.
Still, the high insurance costs and long repair wait times of Tesla vehicles turned rental giants like Hertz away from the brand, as it had to dispose of its Tesla EV fleet at a huge loss.
Just this past year alone, EV insurance rates for the bestselling models in the US were up 28%. That is twice the increase rate of ICE vehicles and, as a result, electric cars are now 23% costlier to insure, at $3,430 on average. According to data analyst Matt Brannon, the "Tesla Model 3, Model Y, and Model X are the most expensive EVs to insure as of February 2025," with the Model 3 costing $4,362 per year.
The Cybertruck, which at one point was deemed uninsurable, is not far behind, with an annual rate now hitting $3,813. Insurers are worried that they might also have to take into account the increased rates of vandalism against Tesla cars because of Elon Musk's newly minted political activism, so their insurance premiums could rise further.
If it is any consolation for Tesla owners, there is one vehicle category that their cars' average insurance claim is comparable to, and it is newer gas-powered vehicles. As cars are getting increasingly complex, the latest models that are full of electronics and sensors to the gills, notched $6,127 in average claim costs in the US last year, only a tad shy of electric cars in general, and Teslas in particular.
This puts car buyers between a rock and a hard place, though, as they have little choice but to drive their older gas-powered vehicles if they want to pay bearable insurance rates, or at least go the mild hybrid way.
Get the 80A Tesla Gen 2 Wall Connector with 24' cable on Amazon
