In a surprising move, GEICO, the second-largest auto insurance provider in the United States, has announced it will no longer offer insurance coverage for the Tesla Cybertruck. The company has begun terminating existing Cybertruck policies, stating that the vehicle “doesn’t meet our underwriting guidelines.”
Potential Reasons for GEICO’s Move
While GEICO has not provided a detailed explanation beyond citing underwriting guidelines, several factors may influence its decision. One major concern could be the Cybertruck’s reliability and repair costs. In recent months, the truck has faced widespread reports of mechanical failures. Owners have shared stories of Cybertrucks becoming “bricked” or completely inoperable without explanation. Some vehicles were locked or unusable for extended periods, causing significant frustration for their drivers.
Moreover, the cost to repair a Cybertruck after even minor accidents has proven to be exorbitant. One owner reported a staggering $13,404 bill for repairs following a minor fender bender. Other reports suggest that repair costs for relatively minor damage can exceed $20,000, making the Cybertruck a potentially costly vehicle to insure.
Issues with Cybertruck’s Unique Design
Another factor that could be affecting GEICO’s decision is the design of the Cybertruck, specifically its 30X cold-rolled stainless steel exoskeleton. In accidents involving other vehicles, the Cybertruck has reportedly caused significant damage while sustaining minimal harm itself. For instance, in collisions with other trucks, sedans, or even animals like deer, the Cybertruck often emerges with little more than surface scratches, while the other vehicle is heavily damaged or totaled. This disparity could be a liability concern for insurance companies like GEICO.
Quality Concerns and Safety Risks
Beyond repair costs and potential liabilities, there have also been concerns about the overall quality of the Cybertruck’s materials. Owners have reported that the “transparent metal” glass has spontaneously shattered after being exposed to the sun for prolonged periods. Others have shared that their windshields cracked after minor contact with everyday items like wedding rings or microfiber cloths. These issues raise questions about the long-term durability and safety of the vehicle, further complicating its insurability.
Speculations Around the Tesla-GEICO Rift
Finally, some have speculated that the decision might have a personal dimension. GEICO is owned by Berkshire Hathaway, led by Warren Buffett, who has clashed with Tesla CEO Elon Musk in the past. Their rivalry dates back to disagreements over Tesla’s solar energy endeavors in Nevada. While this theory remains speculative, it adds another layer of intrigue to GEICO’s sudden decision.
What’s Next for Cybertruck Owners?
For now, Cybertruck owners like Robert Stevenson are left scrambling to find alternative insurers. As of yet, no other major insurance provider has made a public statement about their stance on insuring Cybertrucks, leaving many owners uncertain about the future of their vehicle coverage.
Tesla has not officially responded to GEICO’s decision, and it remains to be seen whether the automaker will address the growing concerns surrounding the Cybertruck’s reliability, repair costs, and overall safety.