Currently, over 180,000 Australians drive electric vehicles, with roughly 50% of them switching to internal combustion engines in the last two years.
If you are planning on joining them, there are several things you will need to consider. Not least, which type of vehicle you are going to purchase. The likes of the BYD Atto, Tesla Model 3 and Polestar 2 are among the most popular choices in Australia right now you can consider.
But when picking your ride, you should also take into account your car insurance, as this might have a bearing on which one you eventually settle upon. When it comes to car insurance coverage, electric vehicles share many similarities with petrol or diesel cars. However, there are also some acute differences that might affect the protection you have and the overall cost of your premiums.
For this reason, it is a good idea to fully avail yourself of what’s incorporated within a policy for insuring an electric vehicle to avoid any nasty shocks in the event of you needing to make a claim.
With that in mind, we’ve put together this guide of what you need to consider when insuring your EV. We hope you find it a useful resource.
Cautious approach from insurance providers
In a similar fashion to an internal combustion engine, it is important to get insurance for your electric vehicle.
That said, as Australians have only been purchasing these cars in the last couple of years, some insurance providers have maintained a cautious approach to what they cover in their policies.
Ostensibly, the main reason for this is because they were trying to establish how these cars would be used and if they had any unique risks associated with them.
Additionally, they were also trying to ascertain how the technology for electric vehicles would stand up to driving on Aussie roads, what specialised repairs might be required, and the costs involved in doing so.
However, thanks to the current increase in electric vehicle adoption, these companies have developed greater confidence in the workings and longevity of electric cars. Subsequently, this confidence is now reflected in their policies.
What to consider when insuring an EV
Today, all insurance firms in Australia offer policies for covering electric vehicles, although they vary quite markedly, depending on the provider.
If you are currently thinking of purchasing an electric vehicle, here are some factors you should bear in mind in relation to your coverage.
1. Brand new or second-hand?
Until recently, there wasn’t really a used-car market for electric vehicles in Australia. But now, with many people choosing to part-exchange or upgrade their existing models for the latest versions, this market is rapidly developing.
For this reason, some insurance companies have notably different policies for brand-new or second-hand cars. These distinctions are due to the overall value of the vehicles and the risks they perceive them to have.
2. EV battery
When EVs were first introduced in Australia, many insurance companies were wary about the capacity of the batteries used to run them. This was one of the main reasons why the cost of insuring an EV has traditionally been higher than that of an internal combustion engine car.
Overall, the quality and performance of EV batteries are constantly improving. However, there is still a disparity between different makes and models.
Subsequently, the cost of insurance for your car might be influenced by the particular brand you want to buy. But ultimately, some providers have more confidence in EV models that come with certain batteries over others.
3. EV charging equipment
In addition to your electric vehicle brand, your premium should also take into account the type and cost of charging equipment you will need to use.
You should make a point of finding out what type of certified equipment will be covered in your policy because your provider might only offer financial protection against certain brands or specifications.
4. Availability of specialists for electric vehicle repairers
Another reason why car insurance has traditionally been more expensive to get for electric vehicles, rather than petrol or diesel motors, is because there weren’t that many specialist repairers around.
Insurers charged a higher premium for covering EVs simply because, in the case of an accident, only a handful of people in Australia had the knowledge and expertise to fix them.
Thankfully, the cost of premiums is coming down as more mechanics and other repairers increase their knowledge base and skill set.
That said, when it comes to taking out coverage for your vehicle, you should try to establish what the insurance company’s repairer network is like, especially for cars from more obscure or newer manufacturers.
5. How easy is it to make a claim
Finally, one of the most important things to consider when insuring your EV is how easy it is to make a claim.
The best way to get a feel for this is to look at Google Reviews, join online forums with other owners of electric vehicles who share their experience, and read car publications.
