Why The Cost Of Owning A Tesla Is Skyrocketing

Over the last 12 months, average full-coverage insurance rates for new cars have risen by around 10%, but the rates for Tesla models have skyrocketed by as much as 29%.

After sifting through more than 97 million quotes to determine the models with the highest increase in full-coverage car insurance rates between 2024 and 2025, the data scientists at Insurify.com found that the top three cars on the list all come from Tesla. What’s more, electric vehicles and those with hybrid powertrain options make up the entire top 10 on the list, a fact that reflects the additional repair costs associated with alternative powertrains.

• Tesla Model Y (1st)
  • Percentage increase: 29%
  • Average Annual Cost: $3,996
  • Base model MSRP: $44,990
• Tesla Model 3 (2nd)
  • Percentage increase: 24%
  • Average Annual Cost: $4,364
  • Base model MSRP: $42,490
• Tesla Model X (3rd)
  • Percentage increase: 22%
  • Average Annual Cost: $4,046
  • Base model MSRP: $84,990

According to Matt Brannon, Data Journalist at Insurify, the increased premiums for Tesla cars can be attributed to repair and replacement costs, though there could be further premium increases in the future for other reasons. “The three cars with the biggest spikes in insurance from 2024 to 2025 have been three Tesla models – Model Y, Model X and Model 3. All of these had an increase of around $600 to almost $800 from March 2024 to March 2025. This does not account for the recent surge in vandalism against Tesla vehicles,” he said.

“Even though reports of vandalism against Teslas have gotten nationwide attention, vandalism would likely have to become more prevalent over a long period of time for it to noticeably affect insurance premiums, but that is a potential outcome,” said Brannon. “It would take time for insurers to work increased rates of vandalism into their rating model and get regulatory approval to raise rates.”

While advanced safety technology, such as that provided by Tesla’s Autopilot and Full Self Driving packages, can mitigate the risk of a crash, they can also add significant costs to repair bills if a crash does take place.

“High-tech vehicles can cost twice as much to repair following a collision. If high-tech features, like those found in Tesla vehicles, offer substantial risk mitigation, then drivers should see comparatively lower insurance costs for these vehicles,” said Brannon. “However, if insurers don’t see a significant benefit to risk mitigation, drivers may end up with higher rates for these vehicles since they’ll cost more to repair but are just as likely to be in an accident. High repair costs factor into EV insurance premiums.”

High repair costs for alternative powertrains are reflected in the rest of the cars on Insurify.com’s list of cars with the highest premium increases over the last year. The Toyota Prius, a car that’s offered solely with hybrid and plug-in hybrid powertrains, landed in fifth place on the list, despite the fact that, at a starting MSRP of $28,350, is well below the average cost of a new vehicle in America in 2025.

Cars from Honda and Hyundai that rank highly on the list of cars most likely to be stolen also rank highly on the list of vehicles with rapidly rising insurance premiums.

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