Lemonade launches an insurance product for Tesla Full Self-Driving customers

Digital insurer Lemonade is launching a new insurance product tailored specifically for users of Tesla’s Full Self-Driving (FSD) system, promising to reduce per-mile insurance rates by approximately 50%. This product, called “Autonomous Car insurance,” leverages previously unavailable vehicle telemetry data obtained through a technical collaboration with Tesla. Lemonade will use this data to train usage-based risk prediction models that differentiate between when a driver is using Tesla’s FSD software versus manually operating the vehicle, allowing for dynamic pricing based on actual driving behavior. The product will initially launch in Arizona on January 26, followed by Oregon in February. While Tesla’s FSD system is not yet fully autonomous and requires drivers to remain attentive, Lemonade’s offering reflects a bet on the future realization of true self-driving capabilities. The insurer emphasizes that Tesla’s AI-driven system, which can monitor surroundings 360 degrees and react instantly, represents a fundamentally different type of “driver” compared to humans. Lemonade’s existing pay-per-mile