Insurance premiums for Tesla vehicles are rising nearly three times faster than the U.S. average, driven by high repair costs and a surge in vandalism, according to a new study by insurance comparison site Insurify. The sharp increases are adding to concerns over the total cost of ownership for the electric carmaker’s popular models.
The study, which analyzed over 97 million insurance quotes between February 2024 and February 2025, found that the average annual premium for full coverage in the U.S. rose 10% year-over-year, from $2,102 to $2,302. In comparison, premiums for Tesla’s Model Y spiked 29% to $3,996 — nearly three times the national average increase.
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“Three Tesla models led the rankings for the steepest premium hikes,” Insurify noted in its report. The Model 3 saw premiums rise 24% to $4,364 annually, while the Model X experienced a 22% jump to $4,046. Other brands such as BMW, Toyota, and Hyundai followed at a distance, with year-over-year increases between 12% and 19%.
The top 10 vehicles with the highest full-coverage premium increases from 2024 to 2025 include:
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Tesla Model Y: +29% | $3,996
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Tesla Model 3: +24% | $4,364
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Tesla Model X: +22% | $4,046
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BMW 5 Series: +19% | $3,229
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Toyota Prius: +18% | $2,151
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Hyundai Santa Fe: +15% | $2,241
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Honda Accord: +14% | $2,623
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Hyundai Elantra: +14% | $2,851
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Honda Civic: +13% | $2,600
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Hyundai Sonata: +12% | $2,735
Tesla’s rising insurance costs come amid broader concerns in the U.S. auto industry. Market uncertainty tied to new tariffs has stoked fears of increasing vehicle repair costs, while EVs — particularly Teslas — remain costly to service post-collision. Insurers are reportedly more likely to total Teslas rather than repair them due to parts availability and proprietary systems.
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While Tesla has launched its own insurance program and opened in-house body shops to bring repair costs down, the impact on premiums appears limited so far. Most Tesla owners continue to rely on third-party insurers.
Analysts say increased reports of vandalism targeting Tesla vehicles may also be contributing to the spike in premiums. Still, high repair bills — especially for models with integrated sensors and custom components — are viewed as the primary driver of rising insurance rates.
With Tesla vehicles now topping the list for annual premium increases, affordability concerns may grow as the EV market matures and cost competitiveness with internal combustion engine vehicles becomes increasingly important.