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Effect of Acceleration Boost on insurance rates

Ok here's a thought experiment. Logic would seem to indicate that upgrading the acceleration on the LR AWD should mean insurance rates for the car go up. It's now a higher performance car. But unless you tell your insurance company, there's no way for them to know. It's the same physical car, just different driving characteristics.

Could they at some point in the future deny a claim because you didn't tell them you bought the boost?

I'd be surprised if they've even thought through the intricacies of this yet since it's such a different paradigm from anything else that's ever been out there.

Curious for thoughts of others here.
 
Ok here's a thought experiment. Logic would seem to indicate that upgrading the acceleration on the LR AWD should mean insurance rates for the car go up. It's now a higher performance car. But unless you tell your insurance company, there's no way for them to know. It's the same physical car, just different driving characteristics.

Could they at some point in the future deny a claim because you didn't tell them you bought the boost?

I'd be surprised if they've even thought through the intricacies of this yet since it's such a different paradigm from anything else that's ever been out there.

Curious for thoughts of others here.


That’s an interesting question. Looking forward to others with more experience chime in.

Here’s an interesting case:

Should I Report My Car's Mods? - Leland-West Insurance
 
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I would not expect your insurance company to cover the $2K for the boost in the event of a total loss since you did not disclose it when you added the vehicle to your policy. But I don’t think the slight increase in speed by itself would be a reason for them to increase your rates. We’ve already had some performance increases through software updates anyway.
 
I would not expect your insurance company to cover the $2K for the boost in the event of a total loss since you did not disclose it when you added the vehicle to your policy. But I don’t think the slight increase in speed by itself would be a reason for them to increase your rates. We’ve already had some performance increases through software updates anyway.

Fair enough, on the $2K for a total loss. Agree that's very unlikely to be covered if it's not disclosed. It's a consideration for anyone purchasing whether or not the possible increase in rate is worth it for coverage in the event of a total loss.

With the previous updates, the entire fleet of that model (in this case, LR AWD) got the update so if the insurance company decided it warranted a rate hike, that's pretty easy to implement across the board for everyone with that config. But this is somewhere between 4-5X the improvement compared to those. There's no denying that the P3D demands a higher insurance rate than the LR AWD. How close can we get to that level of performance before the insurance actuary tables tell them they have to jack the price if you get the boost.

Maybe I'm overthinking and it's a moot point because the rate is more related to the cost of replacement in a total loss scenario and less about the higher performance leading to riskier driving.

It might just be that this is a more cost effective way to get really close the oomph of a P3D without having to pay the insurance rates associated with it.
 

Matsayz

Active Member
Jul 6, 2019
1,283
1,132
Las Vegas
I wouldn’t consider the boost or even FSD a mod because it’s coming from the manufacturer and sold as an option.

You don’t see BMW owners telling State Farm that they paid for the Leather and Connectivity Pkg for CarPlay (yes I knows it’s free now).

This post is not worth worrying about. I think a better thing to discuss is whether you pulled a permit to have your 240v installed...
 

srs5694

Active Member
Jan 15, 2019
1,491
1,970
Woonsocket, RI
Please read the link posted by @Sherlo, above:

Should I Report My Car's Mods? - Leland-West Insurance

In brief, a guy bought a policy on an F250 pickup in 2002, but lied on the application (or perhaps, being charitable, he misunderstood the question), claiming it was stock. In fact he'd replaced the wheels with bigger ones and added a lift kit. Some time later, the guy rolled over another person's foot, causing injury. The insurance company rescinded the policy -- they refunded the premiums paid and, legally, the policy never existed. The insurance company refused to pay the claim, leaving the truck owner in the lurch. This all went to trial and dragged on for years, with a $350,000 settlement against the truck owner at one point, but further court filings after that. I don't see a date on the article (or mention of when the injury occurred), but it references events up to 2010.

The point of this is that the real risk is not that you'll pay an extra $100 a year (or whatever) on insurance, or that the insurance company won't cover the $2,000 cost of a software option from Tesla should your car be totaled; it's that you could get hit paying over a third of a million dollars if your insurance company decides to be a jerk because you failed to report a modification that increases your car's performance.
 

Knightshade

Well-Known Member
Jul 31, 2017
16,191
31,679
NC
Please read the link posted by @Sherlo, above:

Should I Report My Car's Mods? - Leland-West Insurance

In brief, a guy bought a policy on an F250 pickup in 2002, but lied on the application (or perhaps, being charitable, he misunderstood the question), claiming it was stock. In fact he'd replaced the wheels with bigger ones and added a lift kit. Some time later, the guy rolled over another person's foot, causing injury. The insurance company rescinded the policy -- they refunded the premiums paid and, legally, the policy never existed. The insurance company refused to pay the claim, leaving the truck owner in the lurch. This all went to trial and dragged on for years, with a $350,000 settlement against the truck owner at one point, but further court filings after that. I don't see a date on the article (or mention of when the injury occurred), but it references events up to 2010.

The point of this is that the real risk is not that you'll pay an extra $100 a year (or whatever) on insurance, or that the insurance company won't cover the $2,000 cost of a software option from Tesla should your car be totaled; it's that you could get hit paying over a third of a million dollars if your insurance company decides to be a jerk because you failed to report a modification that increases your car's performance.



That example has no relevance here though.

THAT guy lied on his insurance application by saying no when asked if it had been "rebuilt, salvaged, modified, altered or specifically built/customized"

Even though he'd specifically modified/customized it with aftermarket parts prior to answering the question.

They're asking to determine if anything has physically changed on the vehicle such that it might be outside OEM specs/intent and thus might operate in an unexpected way.


This however is an OEM software purchase from the maker of the car, certified to work correctly with said car.


(and presumably you've already purchased the insurance by this point so you're not even answering an application question at that point anyway)
 
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why would it effect your insurance rate?

your vin number still shows LR+, so it's not a "performance" model.

To add to this, the car still has the same hardware (which is what matters). There is no way rates would go up because of this.

Also, from my experience with modifying cars - usually i don't have to declare any additional mods. This is because my insurance gives a ~$10k grace amount for additional mods such as paint protection film, wheels etc. Just keep your receipt for proof of purchase.
 

mswlogo

Well-Known Member
Aug 27, 2018
8,249
7,752
MA, NH
Back when VIN was the same between Stealth Performance and AWD it was no difference in insurance. Highly doubt this will raise insurance cost on boosted cars. Same VIN.

However, if statistically AWD (with or without boost) get in more accidents or more bodily injuries due to the boost. Then all AWD (with or without boost) could go up.

If you chipped your ICE car did insurance go up? Of course not. Even if the dealer chipped it.
 
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srs5694

Active Member
Jan 15, 2019
1,491
1,970
Woonsocket, RI
That example has no relevance here though.

THAT guy lied on his insurance application by saying no when asked if it had been "rebuilt, salvaged, modified, altered or specifically built/customized"

Even though he'd specifically modified/customized it with aftermarket parts prior to answering the question.

They're asking to determine if anything has physically changed on the vehicle such that it might be outside OEM specs/intent and thus might operate in an unexpected way.

This however is an OEM software purchase from the maker of the car, certified to work correctly with said car.

Perhaps I'm just more cynical than you, but I believe insurance companies are, by and large, quite willing to take any excuse to not pay up. If you change the performance characteristics of your car, whether it's through an aftermarket add-on or a software update provided by the manufacturer, and if you're involved in any incident that might even remotely be affected by this update, there's a risk (not a certainty) that an insurance company will use that as an excuse to refuse to pay a claim. If that happens to you, then you'll be in for a nightmarish scenario. Chances are you'll have to go to court to get the insurance company to pay up, and of course they'll be much better able to pay lawyers to fight the claim. Even if you win, it'll be a hellish experience; and if you lose, you could be out tens or hundreds of thousands of dollars. The odds of this happening are low, but given the potentially very high costs, it seems foolish to not give your insurance company a call to see if they want to be aware of the modification. That takes just a few minutes. If you're right, and the insurance company says they don't need to know about it, then you should make a note of who told you this and when, and rest easy. If the insurance company wants to raise your rates a bit, then you can pay that extra and rest easy.

More broadly, people arguing in this thread that there's no need to contact the insurance company with information about a performance-enhancing update, it seems to me, are arguing from ignorance; unless you discuss the matter with your insurance company, you can't know how they'll react, if and when you have a claim to file after paying for a performance upgrade. Sticking your fingers in your ears and saying "la la la la la" very loudly isn't a good way to approach an issue with the potential to cost hundreds of thousands of dollars. Note also that different insurance companies might give different answers to the question, so you shouldn't take one person's experience as a guide to what you might face. A $2,000 software package that changes the performance of a car is something that's fundamentally new in the automotive world, so this is, legally and bureaucratically, unexplored territory. It's situations like this where case law gets made, and that means some schmuck who didn't bother to communicate with his or her insurance company about the upgrade gets pushed through the legal meat grinder.
 

mswlogo

Well-Known Member
Aug 27, 2018
8,249
7,752
MA, NH
Perhaps I'm just more cynical than you, but I believe insurance companies are, by and large, quite willing to take any excuse to not pay up. If you change the performance characteristics of your car, whether it's through an aftermarket add-on or a software update provided by the manufacturer, and if you're involved in any incident that might even remotely be affected by this update, there's a risk (not a certainty) that an insurance company will use that as an excuse to refuse to pay a claim. If that happens to you, then you'll be in for a nightmarish scenario. Chances are you'll have to go to court to get the insurance company to pay up, and of course they'll be much better able to pay lawyers to fight the claim. Even if you win, it'll be a hellish experience; and if you lose, you could be out tens or hundreds of thousands of dollars. The odds of this happening are low, but given the potentially very high costs, it seems foolish to not give your insurance company a call to see if they want to be aware of the modification. That takes just a few minutes. If you're right, and the insurance company says they don't need to know about it, then you should make a note of who told you this and when, and rest easy. If the insurance company wants to raise your rates a bit, then you can pay that extra and rest easy.

More broadly, people arguing in this thread that there's no need to contact the insurance company with information about a performance-enhancing update, it seems to me, are arguing from ignorance; unless you discuss the matter with your insurance company, you can't know how they'll react, if and when you have a claim to file after paying for a performance upgrade. Sticking your fingers in your ears and saying "la la la la la" very loudly isn't a good way to approach an issue with the potential to cost hundreds of thousands of dollars. Note also that different insurance companies might give different answers to the question, so you shouldn't take one person's experience as a guide to what you might face. A $2,000 software package that changes the performance of a car is something that's fundamentally new in the automotive world, so this is, legally and bureaucratically, unexplored territory. It's situations like this where case law gets made, and that means some schmuck who didn't bother to communicate with his or her insurance company about the upgrade gets pushed through the legal meat grinder.

Believe me, I agree insurance companies are vultures. But I've bought way to many cars lately and swapped between trims etc. and was surprised how little difference there was. It turns out the higher trims were cheaper because more affluant people buy those VIN's and get in less accidents. It's all based on VIN's. I worry more about physical changes that are not OEM, like even aftermarket wheels way before I'd worry about a after purchase software boost. This software boosting has been around for a long time from Tesla (uncorking) and there is no history of insurance going up from it that I'm aware of. Possibly some day in the future. But the insurance industry is all based on ICE cars that don't typically get modified like this. There might be laws some day that Tesla needs to inform your insurance company for a mod like this. But today, I wouldn't blink an eye about it.

The insurance industry certainly couldn't do much of anything today until they collect stats on what the impact was. And right now they have no means of tracking who has it and who doesn't. Because they are based on VIN's.

BTW, what will be a problem is if you total your car, will the insurance company pay you back for the boost option. Good luck with that.
 
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Knightshade

Well-Known Member
Jul 31, 2017
16,191
31,679
NC
Perhaps I'm just more cynical than you, but I believe insurance companies are, by and large, quite willing to take any excuse to not pay up.

No disagreement there at all.

But this wouldn't provide them such an excuse.

in the example given the policy holder explicitly lied to a direct question in writing denying he'd made 3rd party modifications that had no review or approval by the actual maker of the car.

No such thing, or anything even remotely like it, is happening here.

More broadly, people arguing in this thread that there's no need to contact the insurance company with information about a performance-enhancing update, it seems to me, are arguing from ignorance;

Really?

Did literally every model 3 owner ever call their insurance company after the first free 5% power update?

How bout the second one?

How many who didn't were denied coverage?

Did you call and talk to them after either? What'd they say?
 
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