Has Elon Musk been put off launching Tesla Insurance UK?

Earlier this year, it seemed as though Tesla was poised to launch its own ‘full-stacked’ in-house insurer.

In February, Insurance Post reported that Tesla was potentially lining up a UK branch of its Malta-based European insurance company Tesla Insurance Europe.

Companies House listings, a job advert seeking a legal counsel to be based in London, and temporary Financial Conduct Authority authorisation made it seem as though the launch was imminent.

Insurance companies in the UK are screwing over EV owners. Perhaps it's time for Tesla insurance to expand globally.

Quote from Tesla customer in the UK

Tesla already provides its own insurance solution to customers in the US, which is available in several states on an embedded basis, and it felt as though Tesla was going to bring that to Europe and the UK.

This was welcomed by Tesla customers in the UK, who have taken to social media asking when the UK will see Tesla’s insurance launch.

One said: “Insurance companies in the UK are screwing over EV owners. Perhaps it's time for Tesla insurance to expand globally.”

Another urged: “Tesla, kindly consider launching your car insurance scheme in the UK soon. Many of us feel we are being unfairly charged for our EV insurance, and believe that your offering could provide a valuable and fair alternative.”

No longer authorised

However, it would appear that the plan to launch a UK insurance firm has gone cold. According to the FCA register, Tesla Insurance Ltd is no longer authorised.

On the company’s page, it says: “This EEA-based firm, which previously passported into the UK, can no longer undertake regulated business in the UK unless an exclusion applies.”

There are also no other Tesla Insurance listings created, and Tesla Financial Services Ltd only has permissions for leasing and financing electric vehicles. No Tesla firm listed on the FCA register has permissions to carry out insurance services, or the ability to hold client money.

Missing persons

People were listed to be involved with the old Tesla Insurance company.

Three people were listed on the FCA register as “individuals previously involved in regulated activities at this firm”. These individuals are Martin Lenhert, Raphael Buttigieg and Andy Wright.

The motivation for starting this business was to improve – and still is to improve – the total cost of ownership of our cars, given that we’re seeing high premiums of insurance from third-party companies. That remains our priority here.

Zach Kirkhorn

Martin Lenhert, who is also listed on Companies House, left the company in September 2022, and now lists himself on LinkedIn as an entrepreneur. Raphael Ben Buttigieg left before Lenhert in July 2022. He is now head of risk at Ivalife.

Andy Wright left way before both Lenhert and Buttigieg, in August 2021. He is now vice president of insurance, and managing director at Zego owner, Extracover.

However, more people were named on the Companies House listings. Like Lenhert, Niklas Huyeng left in September 2022, and he now works for Marsh. Meanwhile, Yaron Klein is listed as chief financial officer for Tesla’s Energy Corporation.

Insurance Post was unable to track down Marisa Attard or Michael Gatt, but they, and all the others including Lenhert, are listed as ‘active’ on the Companies House listing.

So, unless Tesla has set-up a new company that does not bear the Tesla name, it looks as though effort to launch an in-house insurer has gone cold.

Navigating UK motor

And who would blame Musk for changing his mind? It is no secret that the UK motor insurance space has been a difficult one to navigate, especially for electric vehicles.

Just recently, John Lewis announced it was pausing the underwriting of electric vehicles due to claims costs. In the wider motor insurance space, there have been wounded soldiers, such as Covéa and Direct Line Group, and some fatalities, such as Vitality Car.

Then, for Tesla owners, the price of insurance appears to have skyrocketed.

A Guardian article published on 30 September tells the story of a man who was refused insurance for his Tesla Model Y by Aviva when his policy came up for renewal.

In the article, he is quoted as saying: “My insurer was Aviva from July 2022 to July 2023, but when it was coming up for renewal, I received a letter stating that they would not be covering the Tesla Model Y any more.”

In response to the article, an Aviva spokesperson said, “We regularly review our underwriting criteria for all makes and models of vehicles to reflect emerging trends and experience.

“Although we insured the Tesla Y model last year, during the year we changed this acceptance criteria and we were no longer able to offer a policy at renewal.

“However, we have made further changes, and we are able to underwrite these vehicles on some of our products already, and expect others to follow in the future.”

The Tesla owner said he was a member of a Tesla UK owners forum, and added “lots of other people seem to be having the same issue”.

When he was eventually able to get a quote, it had shot up from £1200 to £5000.

The article continued, saying how members of a Facebook group shared stories of inflated renewal quotes, with one describing a jump from £447 to £4,661.

Tesla priority

Tesla CEO Zach Kirkhorn said the point of starting up, and offering its own insurance product, was so that Tesla could offer its customers a cheaper price, bringing the cost of owning a Tesla down.

Kirkhorn said: “The motivation for starting this [insurance] business was to improve – and still is to improve – the total cost of ownership of our cars, given that we’re seeing high premiums of insurance from third-party companies. That remains our priority here.”

Maybe this is something Tesla isn’t quite ready to offer its customers at the moment.

Tesla is due to host its third quarter financial results webcast on 18 October, so maybe the update we are waiting for will come then.

Update: No mention of insurance was included during Tesla's third quarter financial results.