{"id":51138,"date":"2023-12-05T17:49:25","date_gmt":"2023-12-05T17:49:25","guid":{"rendered":"https:\/\/myroadnews.com\/?p=51138"},"modified":"2023-12-05T17:49:25","modified_gmt":"2023-12-05T17:49:25","slug":"tesla-insurance-facing-prospective-class-action-suit-over-inflated-premiums","status":"publish","type":"post","link":"https:\/\/myroadnews.com\/electric-cars\/tesla-insurance-facing-prospective-class-action-suit-over-inflated-premiums\/","title":{"rendered":"Tesla Insurance Facing Prospective Class Action Suit Over \u2018Inflated\u2019 Premiums"},"content":{"rendered":"
Tesla Insurance, the American EV maker\u2019s unit that provides car insurance for its passenger vehicles, must face a prospective class action lawsuit that claims it overcharged customers by basing premiums on \u201cfalse\u201d crash warnings instead of actual driving behavior, a California judge has ruled, according to Reuters<\/em>.<\/p>\n Judge Brad Seligman of Alameda County Superior Court denied Tesla Insurance Inc.\u2019s request to dismiss the consumer protection lawsuit which was brought under California’s unfair competition law by Illinois resident Ricky Stephens on behalf of Tesla drivers in Arizona, Colorado, Illinois, Maryland, Minnesota, Nevada, Ohio, Oregon, Texas, Utah, and Virginia. In other words, all the states where the company provides car insurance.<\/p>\n Tesla\u2019s insurance unit bases its variable premiums on several data-driven factors, including a so-called \u201csafety score\u201d that gets higher or lower depending on how hard the driver brakes, how aggressively the steering wheel is turned, and how many forward collision warning alerts pop up on the car\u2019s screen.<\/p>\n The problem is\u2013as the court action alleges\u2013several Tesla drivers have \u201creported suffering sporadic and random Forward Collision Warnings when there is no danger in sight.\u201d As a result, the safety score went down and the insurance premiums went up.<\/p>\n The case, which is scheduled for an initial hearing in January 2024, is seeking restitution, disgorgement of profits, and an injunction against alleged false advertising. As per Stephens\u2019 lawyer, \u201can injunction would simply require the defendant to make sure that its advertising is accurate, and to take steps to make sure that it doesn\u2019t factor in driving events that never happened.\u201d<\/p>\n Tesla, lawyers representing the insurance subsidiary, as well as an attorney for Stephens did not respond to requests for comment from Reuters<\/em>.<\/p>\n In a separate but similar discussion, Tesla owners who engaged Track Mode on their EVs while driving on closed-course tracks found out after just one day of aggressive driving in controlled conditions that their insurance premiums had significantly gone up. <\/p>\n One owner saw his premium go up from roughly $170 to $328 after driving his 2021 Tesla Model 3 Performance for just one track safety and cornering course at Dominion Raceway in Woodford, Virginia. This happened because the safety score went from 99 before going on the track to 84 at the end of the course.<\/p>\n \u201cI would expect the car to be aware of the fact that I put the car into Track Mode, which I made sure to do every time I got on the track,\u201d Jacobs told InsideEVs<\/em> in a separate article. \u201cI would have expected Tesla not to track my safety score on the track.\u201d<\/p>\n Established in 2019, Tesla\u2019s insurance unit was touted by CEO Elon Musk as providing \u201cvastly better\u201d service than other insurers.<\/p>\n