New energy vehicle insurance price increase? Car companies want to grab business? Look at the pits that Tesla stepped on!

From the official launch of the first batch of new energy exclusive car insurance on December 27, 2021, to the controversy over the premium increase of some high-end models led by Tesla, to the return of consumers to rationality, the improvement of the pricing and protection content of new energy exclusive car insurance has passed for a little half a month.

Although consumers have generally understood that the price increase after insuring new energy exclusive car insurance is only "different from person to person" and "varies from car to car", the "high sensitivity" of insurance institutions to some new energy models has still aroused the great attention of relevant car companies, after all, in the eyes of car companies, the excellent user experience directly affects the future sales of their own cars, and insurance is one of the key factors that determine the degree of user experience.

Not long ago, Weilai had specifically stated that it was "evaluating the possibility of setting up Weilai's exclusive insurance products". As early as before the launch of new energy exclusive car insurance, some car companies and insurance companies have explored the development of car insurance products, eager to try to enter the car insurance market.

"Everything is not to fight the battle of unpreparedness", car companies want to get a piece of the pie in the field of new energy car insurance, may wish to first understand the other side of the ocean, tesla insurance test water effect, what is worth learning, and what pits have been stepped on.

New energy car insurance rises?

Can't generalize!

Recently, after the launch of new energy exclusive car insurance, the topic of "Tesla premiums soared by 80% overnight" has aroused heated discussion. In addition, according to a number of netizens, not only Tesla, Weilai, Xiaopeng Automobile and many other "new forces" models have also seen different degrees of premium increases.

"What about the 80% of owners who say yes?" In the face of rising premiums, many car owners are confused.

For the heated discussion of consumers, relevant media surveys found that "Tesla premiums soared by 80% overnight" is just an isolated case and cannot represent all brands and models on the market.

Subsequently, some car companies also issued notices on the adjustment of car insurance. Tesla responded that different insurance companies, different regions, and different models have slightly different gains. From the latest statistics, the average increase in Tesla car insurance nationwide is about 10%, and the premium of the high-performance version of the more concerned model has risen by less than 20%.

NIO also said that the change in the overall premium is related to the user's region, illegal records, past insurance situations and other factors, and the overall premium adjustment is not large. Xiaopeng Motors said that the average increase of all models ranged from 2.9% to 18.2%.

For some new energy vehicle insurance increases more obviously, some experts have analyzed that the three major factors affecting the pricing of auto insurance premiums are: basic premiums, insurance coefficients and autonomous coefficients, the first two of which are common to the industry, and the autonomous coefficients of insurance companies are the more critical determinants.

In fact, according to the principle of "improving quality and increasing insurance" in accordance with the principle of "improving quality and increasing insurance" in the comprehensive reform of new energy vehicle insurance, according to the "Explanation on the Adjustment of the Benchmark Pure Risk Premium Table for New Energy Vehicle Commercial Insurance Exclusive Products" issued by the China Association of Actuaries, the benchmark premiums of new energy vehicle three insurance and vehicle damage insurance will drop by about 0.8% as a whole, especially for new energy vehicles below 250,000 yuan. This is also the reason why before the sale of new energy exclusive car insurance, the industry generally predicted that 80% of car owners will enjoy the fee reduction.

However, the decline in the basic premium does not mean that the final premium decline, the price of car insurance also depends on the model to which it belongs, the insurance situation in the past year, the number of violations, and the independent pricing coefficient of the insurance company for the model it belongs to. For Tesla and other models with higher maintenance costs and higher prices, insurance companies will choose to increase the independent pricing coefficient, which in turn will increase the premium.

Entering the auto insurance market to grab the cake?

Car companies are eager to try!

As we all know, in the new energy vehicle market, the user's experience is usually valued by car companies. This is also why in the market rumors that new energy car insurance is online, after the premium rises, many car companies rushed to give research feedback.

It is undeniable that in the current situation where the product performance and driving operation of the main engine factories of new energy vehicles are quite different, insurance institutions will indeed be more sensitive in terms of independent pricing.

Recently, Cui Dongshu, secretary general of the Association, suggested that vehicle companies should be encouraged to establish their own insurance varieties, expand the insurance business of vehicle enterprises, and establish their own low-premium insurance system supported by data. The relevant state departments should also give effective support to some problems in the insurance of new energy vehicles to prevent the situation that new energy vehicles are "affordable but unaffordable" due to the high price of exclusive car insurance.

In addition, in response to the latest new energy vehicle insurance provisions, WEILAI Automobile has also said that it is evaluating the possibility of establishing an exclusive insurance product for NIO Automobile.

Previously, Xiaomi, who announced the construction of cars, its vice president Lin Shiwei also publicly said in an interview with the media, "Xiaomi will also lay out the auto finance industry, including auto finance, auto insurance, auto supply chain finance, in-car payment and other scenarios, which will be a large business sector in the future group." This has also been widely speculated by the market, xiaomi in the car at the same time, or will also be expected to layout new energy car insurance.

Test the waters from Tesla

Look at the "pits" of self-developed car insurance!

When it comes to car companies entering the auto insurance market, it has to be said that Tesla is "eating crabs". From the original intention of Tesla's layout of the car insurance business, it is also suffering from "car owners complaining that the premium is too expensive".

Recently, an industry expert wrote in a special research report that according to the data of a US website, the average annual car insurance premium of a Model 3 in the United States for 2021 is 2257 US dollars (assuming all insurance types are insured), equivalent to nearly 14,400 yuan, which is about 20% higher than the average premium of all types of vehicles.

Tesla officially launched "Tesla Insurance" in California, USA in August 2019. The research report pointed out that in addition to the traditional protection, the product terms of "Tesla Insurance" also provide the following special protections based on the characteristics of Tesla vehicles:

Autonomous Driving Guarantee: Liability guarantee for injury caused by the vehicle to a third party in autonomous driving mode.

Wall Mount Charging Connector Property Protection: Provides a guarantee of up to $3,000, excluding product quality issues and losses caused by human error.

Cyber Personal Information Leakage Protection: As a connected vehicle, if the customer's information is stolen through the network and causes loss, it provides a protection of up to $30,000.

Among them, the provision "automatic driving guarantee" provides liability protection for the personal and property damage of third parties caused by accidents in the automatic driving mode of the vehicle. Judging from the research report, this guarantee has a strong exemplary effect on the risk management of all vehicles with automatic driving functions. The new energy vehicle industry model clauses that have just been implemented in the Chinese market have not yet clearly considered the impact and distress of the automatic driving function on traditional car insurance clauses.

In terms of pricing, Tesla's official website has introduced, "Tesla Insurance is a very competitively priced insurance product, designed to provide Tesla owners with preferential rates of up to 20%, in some cases as low as 30%."

Based on California's experience in testing the waters, in October 2021, Tesla went to the next city, and Tesla insurance products expanded to Texas.

According to the research report, Tesla Insurance in Texas is almost identical to the Products of California in terms of terms, and the important difference between the two is the pricing method. Tesla pointed out on its official website that the factors related to the premium only include: model, insurance type, area, mileage, driving score (Safety Score) and multi-vehicle discount (12%). At the same time, Tesla made it clear that pricing does not take into account the credit score, age, gender, marital status, historical insurance, traffic violations and other important risk factors used in traditional car insurance products.

It is worth mentioning that among the premium-related factors, the safe driving score uses data generated by tesla vehicle self-driving related functions, and the Texas version of Tesla Insurance is a UBI product from a technical point of view, but the research report believes that tesla insurance pricing is still subversive compared with other UBI products existing in the US market.

However, according to a research report extracted from a well-known Internet community website in North America, a total of more than 600 discussions about Tesla found that Tesla insurance is still being explored, there are still many negative feedback.

The research report pointed out that most of these discussions and comments on Tesla Insurance are negative, mainly focusing on five aspects, including false warnings (about 30%) of FCW (forward collision warning), reduced driving pleasure (15%), data privacy issues (15%), driving safety (25%), and insurance prices (about 15%).

Taking the FCW error warning as an example, some car owners reported that the FCW mistakenly identified the items in front of it and thought that it was a vehicle, thus issuing a wrong forward collision warning, which reduced the safety score and increased the premium. The apex of the road, the overhanging trees, the fluttering leaves can all be misidentified as the vehicle in front of them and sound an alarm, or when driving during peak congestion or parking in an empty parking lot, it is also possible to trigger sensors to issue an incorrect alarm.

In addition, some netizens said that in some scenarios, the FCW was not triggered, but it was still reflected in the safe driving score. Some netizens questioned the rationality of using FCW for safe driving scores. Current FCW systems are not so well correlated with environmental hazards, and sudden interruptions in the driving process can also cause driver dissatisfaction. When in blind spots, the automatic driving does not react, and artificial emergency braking can also lead to a lower score. Many of the incidents that degrade the safety score are not caused by the driver, but may come from the surrounding environment and vehicle, making the safety score seem somewhat unfair.

Although Tesla insurance is not yet mature, the research report pointed out that from a broader perspective, Tesla hopes to further balance the cost structure of consumer car purchase, insurance and maintenance through Tesla insurance, and optimize the user value of Tesla vehicles throughout the life cycle.

Conclusion

In the context of new energy car insurance, in general, UBI car insurance, represented by real-time driving behavior pricing, is expected to shine in the field of new energy car insurance in the future. However, car companies want to use car insurance to improve user experience and increase user stickiness, and it is inevitable that they need to "feel the stones and cross the river", especially in terms of intelligent early warning and data privacy.