California Regulators Threaten To Revoke Tesla's Insurance License For Mishandling Claims

Tesla launched its ain auto security options for California customers backmost successful 2019, but it whitethorn soon suffer its authorization to do conscionable that. The California Department of Insurance (CDI) issued enforcement actions against Tesla Insurance, which acts arsenic an supplier for State National Insurance Company and is besides named successful nan ineligible notice. The issued warning claims that Tesla Insurance and State National saw "repeated failures to comply pinch long-standing claims handling laws." The agency besides accused Tesla Insurance of "egregious delays" erstwhile responding to its customers' claims and not conducting "thorough, adjacent and nonsubjective investigations of claims."

According to nan filing, nan CDI received 97 complaints astir State National successful 2022 and wished that 21 were justified, while besides noting that nan security supplier committed 40 violations of nan state's security regulations. The numbers skyrocketed complete nan years, yet hitting 1,095 received complaints astir State National, which were boiled down to 415 justified complaints betwixt January 1, 2025 and September 22, 2025. Within this year's complaints truthful far, nan CDI said that State National committed 1,498 violations of nan state's security code.

As for Tesla Insurance, nan CDI received 842 complaints and said that 166 of which were justified successful nan aforesaid clip period. The agency besides accused Tesla of committing 532 violations. On apical of nan violations, nan authorities agency claimed that Tesla Insurance's Head of Claims position was near vacant for respective months, and erstwhile yet filled, saw predominant turnover betwixt April 2023 and May 2025.

After nan filing connected Friday, Tesla Insurance and State National person 15 days to respond to nan CDI. If nan 2 security providers don't resoluteness nan issues laid retired successful nan complaint, they will beryllium put successful beforehand of a judge who will find if they tin proceed offering security successful nan state. Along pinch nan imaginable regulatory consequences, Tesla Insurance and State National will look "monetary penalties up to $5,000 for each unlawful, unfair, aliases deceptive act, aliases up to $10,000 for each specified enactment wished to beryllium willful."