Are electric cars expensive to insure?
Car insurance is an often-expensive fact of life for the UK motorist. If you drive a vehicle on public roads in this country, it has to be insured to at least cover third-party damage, and electric cars are no exception. There’s good reason for this, given that figures show 180,000 incidents a year on UK roads, ranging from small bumps to heavy collisions on motorways.
The good news is that insuring an electric car is no different to insuring any other car. Most mainstream cover providers now cater for electric cars, while there also dedicated electric-car insurers out there eager to take on your business.
Are electric cars more expensive to insure?
It's true that an electric car will – in general – be more expensive to insure than an otherwise directly comparable petrol or diesel counterpart. In 2017, research by price-comparison website Comparethemarket found that some electric cars can cost as much as a 45% more to insure than their conventional counterparts.
However, that 45% figure isn’t always representative. For example, comparing quotes for a 42-year-old engineer living in Banbury, Oxfordshire, who's married and a house owner, there isn’t much between electric and regular cars. We were quoted £525 to insure a 40kWh Nissan Leaf in Acenta trim, while a similarly sized and priced Nissan Pulsar with a 1.6-litre petrol engine would have cost £504 for the whole year.
Another good way to gauge whether or not an electric car will be more expensive to insure is to check what its insurance group rating is. The higher the group, the costlier it is to insure. For example, the Leaf above has an insurance group rating of 22, while the Pulsar is rated as group 11.
Why are electric cars more expensive to insure?
One of the reasons is the cost of repairs. While electric cars have fewer moving parts than petrols and diesels, some components like the lithium-ion batteries are very expensive to repair if damaged. Providers take this into account when calculating premiums.
Another less-discussed reason is the availability of staff to repair electric and hybrid cars. Previous research by our sister title Auto Express found that just a fraction of the UK’s mechanics are qualified to work on electric cars. In 2016, just 1,150 out of a total of 240,000 vehicle technicians were qualified to work on electric cars – with none working in independent garages or body shops.
Steve Nash, CEO of the Institute of the Motor Industry (IMI), has previously said that more than eight in 10 independent garages are struggling to recruit technicians qualified to work on electric cars and hybrids. He said: “This will mean that the market will fail to open up and develop to the benefit of the UK economy, and without competition in the marketplace, the UK customer will suffer higher pricing.”
However, insurance premiums for electric cars will gradually come down. As manufacturers find new ways to cut production costs, and as the number of qualified electric and hybrid technicians increases, electric-car drivers should enjoy cheaper premiums in future. The situation has improved somewhat since the above-mentioned 2016 survey; as our guide to electric car repairs and maintenance details, you can now use the Hybrid and Electric Vehicle Repairers Alliance (HEVRA) website to search for an electric-qualified mechanic local to you.
What you need to tell your insurer if you own an electric car
There are a couple of things you should let the insurer know before purchasing the policy. The most important is whether you have a battery lease on the car or not. If you're leasing the battery separately, you need to let your provider know to prevent any issues should you have to make a claim.
Another is where you'll charge the car. If you're charging it regularly at home, but have the charging cord lying on a public footpath, you have a duty of care to members of the public to prevent them tripping and hurting themselves on the cord. Good liability insurance cover will be helpful here.
Do insurance prices vary between hybrids, electric cars and PHEVs?
Not really. Given they share some form of electric-battery technology and electric motors, they're all likely to have a higher premium than a standard petrol or diesel car. A hybrid or plug-in hybrid won’t necessarily be cheaper to insure than a full electric car, either. It’s worth doing your research on the exact models in question.
How can I bring my premium down?
There are several ways to lower your premium on an electric car. The first is by shopping around for the best deal. Comparison sites are a good start, but not all insurers – especially specialist providers – are listed. Pluginsure.co.uk is a specialist electric and hybrid insurance provider that could help you get a much lower premium. This is why it's also worth considering using an insurance broker.
Paying your premium all at once will work out cheaper than going for monthly instalments, as these often include interest charges. You should also consider installing a black box, or a telematics device, in your car. These monitor driving behaviour such as how fast you’re going, whether you’re braking and accelerating aggressively and your corner speeds. Good behaviour is rewarded with cheaper premiums, with drivers able to save up to 20% compared to normal policies.
Finally, you could consider a dash cam. These are small cameras that sit on the dashboard, continuously recording what's happening in front of the car. If a crash were to occur, this could prove crucial in proving who was to blame and whether or not your insurer will pay out. Some providers offer discounts up to 20% for dash-cam users, but make sure to contact your provider and ask them if they offer any discounts for a dash cam before shelling out for one.