As electric cars become more mainstream, so car insurance companies are responding with a greater choice of policies and lower premiums.
The aim is to address concerns among EV early adopters that they were paying more for car insurance than petrol and diesel drivers.
New analysis from Consumer Intelligence shows 11 new car insurance products began quoting for EVs on a major price comparison site last year. This compares to just three or four for petrol, diesel or hybrid vehicles.
Premiums are falling, as the expansion in repair networks means damaged EVs can be fixed more quickly.
A richer set of claims data is also helping. It shows that the risk profile of EV drivers is becoming similar to that of petrol and diesel drivers. Consumer Intelligence says some electric car insurers have cut prices by nearly 20 percent as a result.
Being more competitive is paying off for insurance companies, too. One increased its ‘EV quotability’ (the frequency at which it quotes) by 40 percent. This earned it a 12 percent increase in its share of the top five quote positions.
“As battery electric vehicles become more mainstream, insurers are no longer treating them as niche risks,” said Consumer Intelligence chief executive Ian Hughes. “That’s creating space for more confident, competitive pricing.”
EV premiums do remain relatively high, acknowledges the insights company. While they may be involved in fewer incidents generally, EV claims tend to be more expensive due to the need for specialist repairs and battery complexity.
Interestingly, London – an EV hot spot – remains a particular issue. Prices were higher in the south east of England than the north west due to differences in traffic congestion, car theft and claim rates.
“While electric vehicle sales remain just short of the government’s Zero Emission Vehicle Mandate target of 22 percent,” added Hughes, “the trajectory is unmistakable. The shift is accelerating and insurers are responding.”
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