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BYD just launched its own auto insurance business, and now Tesla is also reportedly planning to start auto insurance.

recent,Tesla Insurance Brokers (China) Co., Ltd.Officially registered, with registered capital of RMB 50 million, its business scope is insurance brokerage business.

The legal representative is Zhu Xiaotong, senior vice president of Tesla, who is also a big shot around Musk. He is always by Musk's side whenever he comes to China.

This is actually the second time Tesla has registered an insurance company in China.

Tesla registered one in August 2020, and then there was no news. The company was deregistered in April this year.

He registered another one right after canceling his business. It’s obvious that he really wants to get his hands on the insurance pie.

In fact, Tesla is not the only company that wants to provide auto insurance. Many car companies have already made plans.

There are two models here. One is to directly do insurance by yourself, a typical example is BYD, which acquires other companies and then obtains the license for the auto insurance business step by step.

This requires a large capital investment and is difficult to apply for a license, so generally only large and powerful car companies can afford it.

Another is whenInsurance broker or insurance agent, which can be understood as an intermediary. They cannot directly provide you with insurance, but they can cooperate with other insurance companies to develop products, help you choose an insurance plan, handle insurance procedures, and help you claim compensation after the accident.

This also requires applying for a license, but it is easier to obtain approval, and there is no need to invest huge amounts of money right away, so some new forces and foreign companies like to do this.

Tesla registered an insurance brokerage company. Now that it has the company, it is just waiting for the license.

Let me explain here that among the car companies that currently want to provide auto insurance, except for BYD, almost no other companies have actually launched auto insurance products, so the rest of the article will focus on BYD auto insurance as a reference.

If Tesla can get the license this time, I think it will be a good idea to see how Dizi and Tesla sell insurance in the United States.It should be more convenient for Tesla owners to buy car insurance in the future, and the information will be more transparent.

Friends who own a car know that buying car insurance is neither troublesome nor easy.

In fact, most people mainly need compulsory traffic insurance, vehicle damage insurance, and third-party liability insurance, but insurance companies like to bundle you with some scratch insurance, wheel insurance and a bunch of small insurances that you don’t even know what they do.

When my colleague looked through the insurance policy this time, he discovered that his car insurance actually also included window film insurance, luggage loss and home property damage insurance.

We can understand the first two, but what is the insurance for the house property? Do you drive your car into someone else's house and then use the money to compensate them for repairing the house?

Moreover, each insurance company has different strategies, so you have to compare prices from different companies. Therefore, many people do not have the energy to research these small types of insurance and just take whatever the other party says as the truth.

But with car companies in the middle, things become much easier after they do the screening.

Let’s take a look at how BYD Insurance works. I tried it and the experience was really much better.

Except for the first few types of insurance that everyone generally buys, the remaining small types of insurance are not insured by default. You can check the box you want.

ThenHigh degree of freedom, you can choose the coverage of different types of insurance by yourself.

If you think you are a very good driver and will hardly hit anyone, you can choose not to buy insurance or buy an insurance of 100,000 or 150,000 yuan. If you are not a very good driver, you can directly increase the insurance to 10 million yuan, so that you can afford the compensation if you hit a Rolls-Royce Cullinan.

There is also vehicle damage insurance, which means that if your car is scrapped due to fire, water ingress, etc., the insurance company will directly pay you a certain amount of money.

With BYD’s vehicle damage insurance, you can customize the amount of insurance (with a certain upper and lower floating range). To be honest, this is the first time I’ve seen this.

Let’s look at Tesla. The insurance they sell in the United States is quite user-friendly. Car owners can place orders directly from the Tesla App, and the quote information is also very transparent.

If it were to engage in insurance in China, it should be able to continue this fine tradition.

ThenCar companies canStrive for some benefits for car owners.

When we buy insurance, we always ask the insurance specialist if there are any benefits such as cashback. After Tesla's official exit, it has so many car owners behind it, and when negotiating with the insurance company, it can at least ask for some benefits. It's just like group buying, the more people buy, the bigger the discount.

This benefit can be reflected in various forms. For example, Tesla used to always like to offer limited-time insurance subsidies. In the future, you don’t have to limit the time. Just give everyone who buys a Tesla the first year of insurance for free.

Or you can package insurance with vehicle data traffic and maintenance packages, and get their own value-added services when you buy insurance.

In addition, Tesla's approach of linking driving behavior and insurance premiums in the United States may be introduced in the future when the time is right.

In the United States, Tesla has launched a real-time insurance (Tesla Real-Time Insurance). It is a safety scoring system that uses the vehicle's driving data to score the owner's daily driving behavior. If you have front collision warnings, sudden braking, sharp turns, speeding, not wearing a seat belt, etc., you will be deducted points.

The premium for this insurance is based on the weighted scores of the past 30 days. The higher the score, the lower the premium. The reduction can be as much as 20-30%.

This means that the better you drive, the more money you can save.

Currently, only Tesla has achieved such a good idea. Although it may not be possible to completely copy the American system in China due to the differences in the two automobile markets, by making some localized changes, some functions may be realized.

In addition to the above, I believe everyone still has a question.Will Tesla insurance be cheaper?？

My judgment is,It probably won't have much of a price advantage.

Taking BYD Insurance as an example, BYD currently only has insurance business in some regions.

I looked through the feedback from car owners. For many people, BYD auto insurance may be slightly cheaper in the first year of buying a new car. If it is an old car and has never had any accidents before, other insurance companies may be cheaper.

For example, this user is the owner of a 21-model Song PLUS DM-i, which was registered in 2022. This year is the third year of insurance. He had an accident in the first year and no accident last year.

After comparing the quotes from five insurance companies, he found that BYD's quote was the second highest. Moreover, in the most valuable insurance type, vehicle damage insurance, BYD's coverage was the lowest, but the premium was the highest.

If this is the case for BYD, it will be even more difficult for Tesla to lower its prices.

Because BYD is a self-operated insurance company, it has the power to set prices. Tesla is currently only engaged in insurance brokerage business, and it also depends on the opinions of its partners to jointly set prices.

Insurance is an industry that depends on scale. Insurance companies can only make money when more people take out insurance.

When car companies start to do insurance, they initially attract their own car owners, unlike insurance companies that have to cater to many different car owners, so they have more advantages.

Besides, new energy vehicle insurance is not actually profitable right now.

We have analyzed the reasons in previous articles. New energy vehicles are expensive to repair, have a high accident rate, and the number of vehicles in use is far lower than that of gasoline vehicles. By the end of 2023, the number of vehicles in China will reach 330 million, of which 20.41 million will be new energy vehicles.

Therefore, insurance companies' new energy vehicle insurance business almost always loses money.Even if Tesla enters the market, I think the contradiction of "car owners complaining about the high prices and insurance companies complaining about the losses" will not disappear in a short time.

But having said so much, from the perspective of us consumers, the addition of Tesla to the insurance industry is definitely good news.

With the entry of catfish, competition has become more intense. Of course, it would be great if the price of auto insurance could be lowered.

Anyway, the two Tesla owners in the editorial department have very consistent views:Hurry up and sell it. I will buy it as long as you offer a low price.

Written by:Daydream

edit: Neck twisted right & vermicelli & pancake

Art editor: Xuanxuan

Image, source：

Tesla official website, BYD Insurance

Xiaohongshu, @Song Xiaohui who drives BYD

Caixin, Tesla declares insurance brokerage company for the second time

Wall Street News: How Tesla's car insurance is making a comeback

Times Finance, Tesla enters the insurance industry for the second time, second-in-command Zhu Xiaotong serves as chairman, and car companies are scrambling to enter the market