Combine all the ingredients in your Instant Pot. I prefer to use Instant Pot Ceramic Insert when making this Hot Chocolate as there's less chance of milk burning.
Close and lock the lid.
Turn the vent on the lid to the sealing position.
Press Manual or Pressure Cooker button (depending on your model) and using the arrow buttons set the cook time to 2 minutes. Depending on your Instant Pot model, it'll take around 5-7 minutes to come to pressure.
Once the Instant Pot beeps that the 2 minutes of cooking are done, do a natural pressure release for about 7 minutes. This will allow the milk to stop bubbling inside.
Once 7 minutes of natural pressure release are done, do a quick release. This will take about 1 more minute.
When you open the lid, you'll notice that not all of Nutella fully dissolved. This is expected!!!
Strain the Hot Chocolate through a fine-mesh thieve. Push the Nutella through if needed.
Serve with marshmallows or whipped cream and extra cocoa powder.