Tesla (NASDAQ:TSLA) Model S was involved in yet another Autopilot-related accident recently. This time the accident was captured by a camera on the car that was following the Tesla Model S.

There have been several recorded and unrecorded incidents in the past where Autopilot activated vehicles have run into stationary objects. So, the phenomenon is not new. The bottom line in these arguments, almost always, is that Autopilot is a driver assistance feature and that there are many number of reasons why the blame should be with the driver and not Tesla.

The problem is that as more and more Tesla vehicles get into accidents, Autopilot or not, customers and insurers are finding out that it is very expensive to repair/own Tesla vehicles.

The reason for the high repair costs are many but we believe the most important reason is the broken "vertical" model the Mr. Musk loves.

Unlike the NHTSA, which seems to be largely asleep at the wheel, insurance companies are alert to safety/repair issues as they can easily get hit with losses if they misread costs. After all, understanding loss factors is the most important part of insurance underwriting.

With Tesla having barely sold 100,000 vehicles as of the end of 2016, there has not been much history of Tesla available to insurers. However, as the Tesla fleet size grows, insurance companies are starting to see more meaningful data on which they can base their underwriting decisions.

The early signs are not good for Tesla. Periodically, there have been complaints of customers unable to get reasonably priced insurance. The problem was particularly acute in Asia where Tesla ended up offering its own insurance.

Tesla's insurance problems may have taken a very sharp downward turn recently. As of 02/18/2017, Hartford Auto Insurance not allowing Any Model Tesla be written as new business or added to an existing policy in the states of CT, FL, KY, MD, ME, OH, TX, and WV. Hartford is a leading indicator in this regard as the company tends to attract the higher value auto buyers. It is very likely that many others will follow Hartford, and possibly very soon.

Once the insurance companies decide, they are unlikely to change their views unless solid data becomes available that change their worldview.

When it comes to Tesla, of course, there will not be much mitigating data. All publicly available information suggests that Tesla's Autopilot technology is unsafe. If anything, the Tesla product line is going in the wrong direction for several reasons:

Latest Problem For Tesla and Tesla Owners - Getting Auto Insurance.  Might Explain Why Tesla Wants to get into the Insurance Biz!

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