Tesla Cybertruck owners recently reported that GEICO, one of the largest U.S. insurers, has refused to renew coverage for their vehicles. This move comes despite GEICO continuing to cover other cars in their policies. Tesla owners have expressed their frustration on social media, sharing letters they received from GEICO explaining that their Cybertrucks do not meet the company’s underwriting guidelines.
One factor leading to this could be the unique and unconventional aspects of the Cybertruck. Built with a stainless-steel exterior and equipped with unique “transparent metal” glass, this electric vehicle is a departure from traditional automobile design, appearance, and underlying engineering. Unfortunately for owners, the futuristic materials and structure could contribute to the high insurance premiums and the decision by some insurers to drop coverage altogether.
Some owners have reported GEICO quoting insurance premiums that are significantly higher than average for the Cybertruck. While typical vehicle insurance premiums may fall below a couple hundred dollars per month, some Tesla drivers have seen premiums surge to nearly $1,000 per month. This is compounded by reports of high repair costs for even minor accidents, with one owner stating a repair bill of over $13,000 for a fender bender.
New York Vehicle and Traffic Law §319-1 requires drivers to carry automobile liability insurance, with the penalty for being found guilty of the loss of their driver’s license for a year.
Cybertruck’s Futuristic Features are Hard on the Wallet
The structure and components of the Cybertruck, such as its stainless-steel exoskeleton, present challenges not only for owners but also for insurers. While these features make the vehicle incredibly durable, they also result in higher repair costs and increased risks for other vehicles in the event of an accident. Several cases have been reported in which the Cybertruck sustained minimal damage in accidents while inflicting severe damage to other cars involved.
The durability of the Cybertruck may be impressive, but it also raises liability concerns. In accidents, the Cybertruck often remains relatively unscathed, while the other vehicle may be totaled, posing potential financial risks to insurers like GEICO when their drivers are negligent in causing personal injuries. The unique glass used in the vehicle has also been prone to unexpected issues, including reports of spontaneous shattering under certain conditions. Owners have raised concerns that even light impacts have caused the windows to break, leading to further repair costs.
Adding to the problem are the long wait times for repairs, which may be due to the specialized nature of the Cybertruck’s materials and parts. Owners have expressed frustration at the delay in repairs, with some reporting weeks or even months to fix relatively minor damage. The high cost of repairs and extended wait times could further deter insurers from covering the vehicle, as it increases their potential financial exposure.
Tesla’s Service Problems and the Cybertruck’s Future
Beyond repair costs, Cybertruck owners have also reported recurring mechanical problems, including vehicles being "bricked" and sudden breakdowns. Some owners have experienced extended periods without access to their vehicles, often waiting for Tesla to resolve these issues. In some cases, the vehicles were completely replaced by Tesla, though problems persisted even with the new trucks.
Given the high profile of these issues and the possibility of more widespread mechanical defects, there is speculation that Tesla may issue a recall for the Cybertruck. This has prompted insurance companies to reconsider their policies, as the potential for a recall adds another layer of financial risk. Tesla has yet to announce any formal recalls, but continued reports of reliability problems may influence insurance providers like GEICO to distance themselves from the vehicle until the issues are resolved.
Conclusion
Tesla’s Cybertruck, while revolutionary in many respects, presents unique challenges for both owners and insurance providers. The combination of high repair costs, mechanical issues, and liability risks associated with its design may explain GEICO's reluctance to offer coverage. While other insurers may still provide policies for the vehicle, Cybertruck owners should be prepared for significantly higher premiums and potentially limited coverage options moving forward.