Tesla speaks on insurance plans

Hi there,

Distracted driving was a common theme in the recent earnings calls of publicly-traded P&C insurers. The impact on rising auto insurance rates from deadly accidents spurred by distracted driving is highlighted in the graphic below.

We’ve seen some recent moves by insurers in this regard. AmFam, for example, partnered with startups Automatic and TrueMotion, as part of its recently launched driver safety program, KnowYourDrive.

Meanwhile, Tesla’s earnings call suggested a different auto insurance future. As Elon Musk and Tesla VP of Investor Relations Jeff Evanson said,

Evanson: We’ve been doing it quietly, but in Asia in particular where we started this, now the majority of Tesla cars are sold with an insurance product that is customized to Tesla, that takes into account not only the Autopilot safety features but also the maintenance costs of the car. It’s our vision in the future that we’ll be able to offer a single price for the car, maintenance and insurance in a really compelling offering for the consumer. 

Musk: If we need to we’ll insource it, but I think we’ll find that insurance partners do adjust rates proportionate to the risk of a Tesla.

Different routes

Last week, we described the differing strategies of China internet giants Ant Financial, JD Finance and Baidu in their attempts to obtain their own insurance licenses. As China’s insurance premiums grow at a rapid pace, such licenses “are becoming the hottest financial resource on China’s capital market.”

On a separate note, another major fintech player in China, CreditEase, saw its online insurance agency unit this week raise $11M in new funds at a $200M valuation. CreditEase Insurance Agency sells insurance products in China on behalf of more than 50 domestic and overseas insurers.

New data

Yesterday, we released our 2016 Global Corporate Venture Capital Report highlighting corporate venture trends through 2016. Download a copy here.

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Have a great rest of the week,

Matt
@mlcwong

P.S. Hear from incoming Attune CEO James Hobson, CreditEase Fintech Fund partner Anju Patwardhan, 8VC founding partner Joe Lonsdale and many more at our Future of Fintech conference in June. Subscribers can receive a $1000 discount with code FutureInsurance17.