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Comment by function_seven | Hacker News Reader

It’s insane. One of the stories about Chevrolet—when they were first designing the C5 Corvette—was that they took input from the insurance industry regarding repair costs.

One example of this is the hood. The previous generation had a beautiful clamshell hood that wrapped down around the sides. Opening the hood made the front end almost look like an open-wheel car. But it was expensive to make in one piece, and the entire piece had to be replaced if any part of it was damaged.

The C5 has a more conventional hood, with seams running along between the fenders and the hood panel. Not as pretty, but substantially cheaper to repair.

So, $900 for a headlight? We need to strengthen (or better align) the incentives for carmakers to reduce component costs.

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This was Saturn’s big value proposition: GM used plastic for external body panels as they were more resilient to light damage and were pre-finished for cheaper replacement.

Expensive insurance will also kill cars, so insurance companies are definitely consulted stakeholders in vehicle manufacturing.

There is a huge incentive misalignment. The customer pays monthly for “insurance” and the moral hazard, the insurance company then pays a repair company, who then pays the OEM for the headlight.

The games all go away when the manufacturer sells the insurance, estimates how safe the driver is with data, and then handles the repairs.

Tesla understands this and sees it as a way to beat the competition on total operating cost for the customer.

I don't understand why more people don't check insurance rates before buying a car.

Insurance rates will eventually be reflected in the way the market prices the car. It would be more efficient if people checked, but the current process is close enough.

Because the difference from model to model is a) not that high when cross-shopping models of the same form factor b) outweighed by demographic correlation factors.

People do cross shop different classes of vehicle, but even within a particular vehicle class, the differences can be easily be more than enough to be an important factor in purchasing. If you're comparing two vehicles, and one is $1000 cheaper to purchase, but costs 20% more on insurance... it likely isn't cheaper by the time your loan is paid off.

Tesla wants more to insure my Model 3 than USAA does, and that’s with lower coverage limits. Perfect safety score.

That’s without getting into how much better USAA’s service is compared to Tesla.

And if you have other non-Tesla cars you probably will benefit from having them on the same policy.

Must I explain why people who serve in the US military are much better drivers on average? I’m going to go out on a limb and guess in addition to your perfect driving score, your Tesla is clean as well. I bet you probably agree with a statement like “there is no such thing as an accident”.

Enjoy your cheap car insurance. :)

Do we though? What percentage of cars are ever in an accident? If the choice is between better functioning while working versus lower repair costs, it's not obvious why we would prioritize lower repair costs. People on here always have this idea that repair must be prioritized above all without considering the tradeoffs.

Tesla sells insurance, so has a direct incentive to make its cars easier and faster to repair. Previously Tesla is notorious for how long it takes to get parts, but that is improving, partly because of the insurance incentive.

Elon Musk has mentioned one reason Tesla started doing insurance was to get more insight into repair costs and processes to help improve both vehicle design and the repair experience.

The first-gen Dodge Viper was notoriously expensive to repair for the same reason: the clamshell hood.

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