How Much Does It Cost To Insure Electric Car – The history of electric vehicles (EVs) can be traced back to the internal combustion engine. Thomas Edison was a proponent of electric cars, and he and Henry Ford even developed an electric car together in 1914.
Perhaps if their early work pushed EVs into the mainstream, it would be easier to insure them today. As it stands, there are some challenges in terms of cost.
How Much Does It Cost To Insure Electric Car
Electric vehicles make up only a fraction of Australia’s cars, but that’s changing every year. As of the August 2021 report, the Electric Vehicle Council (EVC) found that EVs accounted for 1.57% of total light vehicle sales, a little more than doubling from 2020. Even though Australians don’t have access to the full range of electric vehicles, people seem to like electric vehicles because of federal policy.
Electric Vehicles Can Help Prevent Arctic Sea Ice From Melting
Despite this growth, we are still behind the rest of the world – EVs have a global market share of around 4%, with leaders Norway and the UK accounting for around 74% and 10.7% of EV sales respectively. Beyond that, subsidies and emissions targets to encourage EV use are not part of our public transport strategy. This has hampered development as other world leaders plan to ban the sale of new gasoline and diesel-powered vehicles for the next decade.
But on a personal level, if you can afford to buy an electric or hybrid vehicle, your next pit stop might be a chat with an insurance company.
Currently, insuring an electric vehicle is a bit expensive. But contrary to popular belief, this is not necessarily due to the car’s high market value.
The lowest bid in seven cases was $1,171. Also, the average annual premium is about $1,415, excluding the usually very expensive Tesla. For context, the average auto insurance premium for all vehicles is $952.
Electric Vehicle Prices Rise As Raw Material Costs Double To $8k
While most auto insurers cover electric vehicles, their current policies were originally designed with combustion engines in mind. We spoke with EVC’s Policy and Communications Officer, Alexandra Kelly, about the biggest challenges the insurance industry may face.
The first thing Kelly points out is that EVs tend to have higher insurance coverage, not because they cost more, but because of the high level of uncertainty surrounding them. “Obviously, more expensive vehicles will have higher premiums anyway, but the reason we’re seeing EV insurance priced so high is because it’s new to the industry,” she said.
Suddenly, Kelly points out, you have this new car that’s not a car at all, it’s more of a computer on wheels.
“So it doesn’t have an engine and it doesn’t have all the components in an internal combustion engine, but you’re asking for insurance to still insure the vehicle,” she said. “Bidders will say, ‘Well, we have too many unknowns to compete and do this safely, so we’ll add a premium that will cover any risk we may have in funding future operations. ‘
Car Insurance For Electric Cars
“Insurers are definitely becoming more aware of EVs,” Kelly said, “for example, the NRMA is really pushing for EVs.”
As you know, electric cars generally cost less to run than regular diesel or petrol cars. The question is, does the fuel savings outweigh the cost of insurance?
According to EVC, the total operating cost of an electric vehicle is lower than that of an internal combustion engine vehicle. The EVC states on its website that the average Australian drives around 15,000km a year and spends around $2,160 a year (or 14 cents per kilometer) on petrol. However, an electric car traveling the same distance would only incur about $600 in electricity bills per year (4c per kilometer).
Kelly agreed, saying the cost of insurance would not outweigh the maintenance and fuel savings. “For that to happen, there has to be a very, very high premium. So despite the higher premium, you still get the financial benefits of having an electric car.”
Is Electric Car Insurance Expensive?
EVC also said that in 2018, maintenance and service costs for electric vehicles were estimated to be around $300 to $400 per year. As a result, you not only save on fuel costs, but also on vehicle maintenance.
Kelly added that while there are about 20 moving parts in electric vehicles, there are more than 2,000 in internal combustion engines. “When you send an electric car in for service, they check the tires, the brake pads, the steering, that’s all,” she said. “Then they’ll look at the software. If you have a Tesla, your software will be updated regularly.
“You simply can’t compare an internal combustion engine to an electric car, they’re just not on the same page. You typically have a car serviced every 12 months, and with an electric car, you probably don’t have a service inspection for 18 months.”
According to EVC’s 2020 State of Electric Vehicles report, Australia currently has 2,307 public charging stations. This number has increased significantly (over 40%) since 2019 and will continue to increase as the market expands.
Average Cost Of An Electric Car Uk 2022
NRMA has also recently partnered with the NSW government to provide at least 20 additional fast chargers for electric vehicles in the state’s key regional corridors.
When it comes to practical maintenance, Kelly said TAFES and government agencies are looking at how to develop training courses to give technicians the skills they need to work in electric vehicles in the future.
At the end of the day, insurance is about risk. If insurers cannot confidently identify risks, it is understandable that they may raise premiums to ensure they are fully covered. But as more is learned about the technology and more facts, figures and case studies become available to base insurance premiums, there is a chance that EV insurance costs will drop.
Most providers in Australia offer electric car insurance. Go to our auto insurance comparison page to see what policies are currently offered.
How Does Your Job Title Affect Electric Car Insurance?
Terms, conditions, exclusions, limitations and sub-limitations may apply to all insurance products displayed on the website. These terms, conditions, exclusions, limitations and sub-limitations may affect the benefits and coverage available under any insurance product displayed on the website. Please refer to the relevant product statement and target market regulations on the provider’s website for more information before making any decisions about an insurance product.
Tara McCabe writes about all areas of personal finance, from banking to insurance. An expert in practical financial tips, Tara shows readers how to live a richer life and be socially conscious while doing it. She holds a BA (Hons) in English Literature from Canterbury Christ Church University.
Join the 25,000+ subscribers who receive our weekly Moneyzone newsletter featuring the latest rate changes, exclusive deals, money-saving tips and expert insights from .com.
Our goal is to help you make informed financial decisions, and we offer award-winning comparison tools and services for free. As a marketplace business, we make money from advertising and this site contains products with go-to-site links and/or other paid links, suppliers will send us a request if you visit their site from our site or check out a product with them Pay the fee. You don’t need to pay any extra to use our services.
Electric Vehicle Total Cost Of Ownership Calculator
We pride ourselves on the tools and information we provide, and unlike some other comparison sites, we also include the ability to search our database for all products, whether or not we have a commercial relationship with the suppliers of those products.
The “Sponsored”, “Hot Sale” and “Featured Products” labels indicate products that the vendor has paid to promote more prominently.
“Sort order” refers to the original sort order and does not in any way imply that particular products are preferred over others. You can easily change the sort order of the products displayed on the page. An analysis of car deals from seven model years found that Geico offers Wrangler owners the cheapest car insurance. Geico’s comprehensive insurance policy costs $1,562 per year, which is 16% less than the average of the companies we surveyed.
Geico offers the cheapest full coverage auto insurance for the Jeep Wrangler. In the four model years we studied, the average annual interest rate for insurers was $1,526 per year, or $127 per month. That’s $296 less per year than the average across all insurers.
Answers To Common Questions About Electric Vehicles
While Geico generally offers Wrangler owners the cheapest car insurance, Progressive also offers them low-cost car insurance. Progressive’s offer is 13% below average, which equates to a $41 annual cost difference.
On average, older Wranglers are cheaper than newer models. For example, a comprehensive policy on a 2019 Jeep Wrangler costs $362 less per year than insurance
How much would it cost to insure my car, how much does it cost to insure a new car, how much does it cost to insure a motorcycle, how much does it cost to insure a diamond ring, how much does it cost to insure an engagement ring, how much does it cost to insure a corvette, how much does it cost to insure a ring, how much does it cost to insure a classic car, how much does it cost to insure an rv, how much does it cost to insure a small business, how much does it cost to insure a semi truck, how much does it cost to insure a car