American electric vehicle and clean energy company Tesla Inc. is reportedly continuing its efforts to enter the Israeli market by holding talks with companies in Israel’s insurance and financial sectors, according to Globes. In mid-April, The Jerusalem Post reported that Tesla recently appointed its technical service manager for Israel, local […]
American electric vehicle and clean energy company Tesla Inc. is reportedly continuing its efforts to enter the Israeli market by holding talks with companies in Israel’s insurance and financial sectors, according to Globes. In mid-April, The Jerusalem Post reported that Tesla recently appointed its technical service manager for Israel, local industry veteran Ilan Benaro, and was pushing ahead with its planned commercial launch in Israel. Now, Tesla is reportedly starting the next step of its strategy of entering the local market and has sent representatives that according to Globes have been meeting with senior executives from Direct Insurance – Financial Investments Ltd., one of Israel’s largest insurance companies. Tesla established its own independent insurance company in 2019, currently only available to its clients in California, and while the details are not yet completely clear, it is believed that Tesla is looking to set up an insurance model for its cars and that’s what the discussions with the Israeli insurance company are focusing on. Tesla’s insurance is based on data analysis live-streamed from the vehicle using algorithms that calculate the cost of insurance based on the profile of the driver, or rather, the profile of how the car is being driven, the usual destinations that the car reaches and the overall level of risk that these factors pose. The process of joining Tesla unique insurance model is simple and can be completed within a few minutes through the company’s phone app that uses the data collected in real time and calculates an offer accordingly. The price is reportedly revised as more data is collected. The average cost of this kind of insurance model is reportedly much lower than more classic models proposed by external insurance companies.Having said that, its clear why Tesla’s vehicles and the insurance model they offer with them are presenting a real challenge to traditional insurance companies. According to the Globes report, Tesla is looking to expand its insurance model to all markets in which in operates, and is currently focusing on China and Europe. However, it seems like the company has also targeted the market in Israel. If Tesla does indeed enter the Israeli insurance market, it is unlikely to deal with the compulsory insurance system that covers injury to drivers, passengers and pedestrians, but will most likely focus on selling third-party insurance deals that cover damage to vehicles caused by accidents.