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Not only is it exaggerated, but it is not true! The i3 does not have run-flat tires. TireRack lists the OEM tires at $135-$153 depending on size, plus shipping. So I think the financial manager was either misinformed or trying to scare you into buying this expensive insurance. I heard a similar insurance sales pitch including a cracked BMW (but not i3) wheel being rolled out to show what could happen on our pothole-infested roads, but I, too, declined.