Tesla opened its very first showroom on 15th July, 2025 in Bandra, Kurla Complex, which marked its entry in the Indian EV car market. This move not only drives up the EV market but also dares car insurers to innovate and remain competitive.

Tesla’s advanced safety features promise reduced accident risks, but its expensive repair, special parts, and import duty make premium pricing the biggest insurer challenge. With EVs rapidly being adopted, digital changes, from AI-based risk underwriting to telematics-based policies, are transforming the business of insurance companies in India.

How Tesla’s Entry is Reshaping India’s Insurance Landscape

As the demand for EV vehicles increases, individuals also ask for EV-specific insurance cover schemes and individualised premiums. Well, the requests are granted, as Tesla is already working with Indian Insurance companies such as ACKO to provide customised Tesla car insurance plan in India.

1.     EV Specific Add-ons

The special mode of EVs in relation to fuel cars also requires a different insurance scheme. For example, adding features such as a battery protection cover or battery replacement can account for 40-50% of the cost of the car.

Some other best-selling add-ons for EVs include Charging Equipment Coverage, Sensor Coverage, and Camera Protection.

2.     Tesla Partnership With Indian Insurers

Tesla has its own insurance organisation providing completely personalised insurance for Tesla cars using personalised data powered by telematics.

However, it is currently not available in India, but they are partnering with different digital insurance providers to make it properly accessible for people.

3.     Enhanced Customer Service

Digital innovations and the use of AI have streamlined the entire operations of insurance companies. From getting the auto insurance quotes in just a few clicks to making claims and receiving settlements, everything can happen within minutes.

Digital-first insurance providers are also integrating their insurance policies for house charging failures and on-road charge depletion problems.

4.     Potential for Telematics Integration

Currently, insurance companies use traditional factors such as a car’s age, location, and driving record to disclose premium prices. However, the use of telematics-driven data to provide personalised premium prices based on driving behaviour can be used in future.

5.     Encouraging Safe Driving Habits

Tesla uses telematics such as forward-collision warnings, aggressive turning, and forced autopilot disengagements to calculate insurance premiums in the US and the UK. This encourages people to drive safely and follow traffic rules while driving.

What is Covered in EV Car Insurance in India

Here is a list of items covered in the insurance policy for Electric vehicles and Teslas in India:

• Battery Protection Cover: Batteries are the most expensive part of an EV car, covering up to 50% of its initial price. Although warranty is mostly available for EV cars based on mileage or age, getting battery coverage is necessary to deal with sudden battery failures.

• Sensor and Camera Protect: EV cars come with technologically advanced features. Getting a fix for any tech failure is expensive. Understanding this issue, some insurance providers offer protection for accessories like sensors and cameras.

• Technology Items Protection: EV cars generally have high-tech systems such as ADAS, sensors, and cameras. Getting insurance with this coverage will financially safeguard you from the failure of these expensive items.

• Own Damage Protection: Insurance companies offer financial protection against damage to your car in their comprehensive insurance policies. The comprehensive policy also covers damages to third parties and their belongings.

• Third-Party Coverage: The Third-Party insurance plans cover losses for third-party injuries and their belongings in case they suffer a loss in an accident with your EV.

What is Not Covered in EV Car Insurance in India?

• Regular Wear and Tear: Any loss or damage to the car due to regular wear and tear is not covered in the car insurance.

• Driving Without Necessary Documents: Driving without necessary documents, such as a driving license or RC, can cause a rejection of your claim.

• Driving Under Intoxication: Causing a loss to yourself or a third party due to driving under intoxication will lead to rejection of the claim amount and a penalty.

• Geographical Limit: If you drive your Tesla outside of the geographical limit as prescribed in your policy, it may lead to a rejection of the claim amount.

Final Thoughts

Tesla setting foot in the Indian market is not just a big step for the EV market but also a major shift for Car insurance companies in India. Tesla’s coming into the market will boost the growth of other competitors in the EV market.

Most insurance companies are trying to gain a first-mover advantage, and some partnered insurance companies like ACKO have already started to construct insurance plans tailored specifically for Tesla owners, covering their unique components, such as electric drive units, and advanced tech features.

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