The Australian arm of Zurich Insurance is offering some motorists cheaper premiums, provided they don’t do all the driving.

Zurich is the first Australian insurer, and the second globally, to use Tesla’s Full Self-Driving (FSD) (Supervised) technology as a rating factor when pricing cover.

The move applies to eligible Tesla customers under Zurich’s InsureMyTesla and comes as Tesla data claims vehicles using FSD (Supervised) have seven times fewer major or minor collisions than regular electric vehicles.

FSD (Supervised) has been available to owners of newer Model 3 and Y vehicles in Australia for about a year, at a subscription cost of $149 a month.

The system uses eight external cameras to provide a 360-degree view around the vehicle, processing more than a million pixels of visual data every millisecond.

But Tesla warns FSD (Supervised) is not a fully autonomous vehicle.

Instead, it is an advanced driver-assistance system that performs complex driving manoeuvres like steering, lane changes, and turns “while requiring active supervision at all times”.

Zurich head of General Insurance Alex Morgan said the insurer used Tesla’s data, as well as its own underwriting technology experience, to determine the lower risk associated with supervised self-driving.

“As vehicle technology and driver behaviour continues to evolve at an extraordinary pace, it is critical that we continue to innovate alongside this change,” Morgan said.

The technology appears to outperform human drivers. Photo: Tesla

“Humans make mistakes. They get tired. They can be distracted,” he said, adding the technology is far from flawless but appears to outperform drivers on frequency of error over time.

Zurich product manager David Toma said accepting FDS (Supervised) as “an exciting milestone”.

“The data shows that drivers using this technology are involved in far fewer accidents, so it’s important they can access insurance that reflects this lower risk,” Toma said.

Since launching in Australia and New Zealand in October 2025, Tesla customers in the region have self-driven more than 132 million kilometres using the technology.

Earlier this year, researchers from the University of Queensland spent 100 days using a Tesla Model Y equipped with with FSD.

According to researcher Zuduo Zheng, the team recorded more than 500 safety-critical events where the system required driver intervention or revealed an important limitation in how it interpreted the road environment.