Lemonade to cut insurance rates for Tesla FSD drivers as new autonomous car product launched

Insurer Lemonade has announced it is slashing rates for owners of full self driving (FSD) Teslas as it launched a new autonomous car insurance product.

Called, Lemonade Autonomous Car, the proposition is designed specifically for self-driving cars. It will be rolled out first with Tesla FSD, with Lemonade saying that the new offering cuts per-mile rates for FSD-engaged driving by approximately 50%.

Lemonade will achieve this by getting access to vehicle data that was previously unavailable. 

Data captured feeds into Lemonade’s usage-based risk prediction models, to distinguish between autonomous and human driving, as well as predict risk based on the autonomous software version installed in the car, the precision of its sensors and more.

“Traditional insurers treat a Tesla like any other car and artificial intelligence (AI) like any other driver,” said Shai Wininger, co-founder and president at Lemonade.

“But a car that sees 360 degrees, never gets drowsy and reacts in milliseconds can’t be compared to a human.

“Our existing pay-per-mile product has given us something no traditional insurer has. A unique tech stack designed to collect massive amounts of real driving data for precise, dynamic pricing. Lemonade Autonomous Car was built on that foundation.”

Further reductions

The product will begin rolling out in Arizona on 26 January and in Oregon a month later.

Lemonade expects further reductions to per-mile rates as Tesla releases FSD software updates, which are anticipated to make the cars even safer over time.

“Teslas driven with FSD are involved in far fewer accidents,” Wininger added.

“By connecting to the Tesla onboard computer, our models are able to ingest incredibly nuanced sensor data that lets us price our insurance with higher precision than ever before.”