Know Why Electric Cars Insurance Is Expensive?

Get Car Insurance starting at only ₹2,094/year #
Processing

Pollution and fuel prices are rising constantly and the only solution to these two problems is electric cars. Electric cars are the future of the automobile industry as they are cost-effective and environment-friendly in nature. Despite all the advantages, EV insurance still remains more expensive than petrol/diesel cars. Let us know the reason behind this further in the article.

Read more

  • Renew policy in 2 minutes*

  • 20+ Insurers to choose

  • 51 Lakh+ Vehicles Insured

#TP price for less than 1000 CC cars. All savings are provided by insurers as per IRDAI approved insurance plan. Standard T&C apply.

Get Car Insurance starting at only ₹2,094/year #
Looking for Car Insurance?
    Other models
    Other variants
    Select your variant
    View all variants
      Full Name
      Email
      Mobile No.
      View Prices
      Please wait..
      By clicking on “View Prices”, you agree to our Privacy Policy & Terms of Use
      Get Updates on WhatsApp
      Select Make
      Select Model
      Fuel Type
      Select variant
      Registration year
      Registration month
      Save & update
      Please wait..
      Search with another car number?

      We have found best plans for you!! Our advisor will get in touch with you soon.

      Is Electric Car Insurance Expensive?

      The first and foremost purpose of a person purchasing an electric car is its environment-friendly nature, as well as cost-effective runtime. But when it comes to purchasing electric car insurance, the cost of the premium gets really high. One of the major reasons behind the higher car insurance premium of an electric car is that the repair cost of such cars is higher due to the advanced technology used in the car.

      Moreover, electric cars may suffer heavy damage because of their lightweight. All of this and many other reasons, automatically increase the liability of the insurer due to which he/she increases the insurance prices for EVs.

      Reasons Behind Higher EV Insurance Premium Rates

      There are several other reasons behind the higher electric car insurance cost in India. Here are some of them:

      1. E-Cars are Expensive

        Due to electric cars run on electric motors, battery packs and transmission modes. The battery pack among these are the most expensive component thus adding to the manufacturing cost of an EV. These batteries are made of lithium-ion which makes electric vehicles expensive in the market.

        Thus the insured declared value of EV insurance also goes higher and increases the premium rates.

      2. Car Battery Replacement

        Electric cars are powered by powerful batteries and come with an expiry date. The car owner has to replace the battery before they stop working properly. Electric cars run on lithium-ion batteries. Replacement of these lithium-ion batteries is expensive.

        If the life of the lithium-ion battery is long then the car owner would not have to replace the batteries frequently. The lower the frequency of replacement, the lower the liability of the insurer This will result in lower premium rates of the third-party car insurance policy.

      3. High Maintenance

        Electric cars are expensive and they also require higher maintenance. It is because an electric car consists of complex and expensive car parts. Thus, the repairing of e-cars requires high skills to service or repair any damaged part.

        Since there are not many electric car owners in India, the number of mechanics is also lower than the traditional car mechanics. This is why the labour cost of servicing and repairing the electric car is high because the skilled e-car mechanic charges higher than a traditional car mechanic. This in turn results in a higher EV insurance cost.

      Third-Party EV Insurance Cost in India

      The premium rates for third-party liability insurance are fixed by the Insurance Regulatory and Development Authority of India (IRDAI). As an initiative to promote the use of electric vehicles in the country, the IRDAI has set the third-party liability insurance premium rates at a 15% discount as compared to petrol/diesel engine vehicles.

      The third-party insurance rates are based on the capacity of the battery as mentioned in the table below.

      Capacity of battery Premium Rate for 1 year (In INR.) FY 2022-23 Premium Rate for 3 years (In INR.) FY 2022-23
      More than 65 kilowatt 6,712 20,907
      More than 30 kilowatt & less than 65Kilowatt 2,904 9,044
      Less than 30 kilowatt 1,780 5,543

      The premium rates of the comprehensive insurance policy for an electric vehicle vary from insurer to insurer as they are based on various factors.

      Information to Share with Insurer about E-Car while Purchasing EV Insurance

      The insurance process for both electric cars and petrol/diesel engine cars are the same but the difference in the premium rates depends on the IDV of the vehicle. So, while purchasing the insurance policy for an e-car, the insurer will ask for some important info related to your e-vehicle. These include:

      1. Car’s Model

        The IDV depends on the approximate market value of the car. Hence it is important to tell your insurer about the car’s model.

      2. Manufacturing Year

        The year of manufacturing helps the insurance company calculate the depreciation value of the e-car. This helps them assess the Insured Declared Value required for the e-car.

      3. Location

        Tell your insurer about the geographic location of your e-vehicle because there are some locations with high and low risk. The premium rates of the insurance policy will be higher in high-risk areas.

      Ways to Reduce Electric Car Insurance Cost in India

      The premium rates of the e-car vary from insurer to insurer and depend upon the kind of coverage you opt for. Since we are talking about e-cars here, let us tell you how can you keep the premium rates of your electric car insurance lower.

      1. Purchase Policy Online

        The first and foremost step an e-car owner can take is to purchase the insurance policy online. When the buyer opts for an online purchase, he/she gets to compare different policies and then chose the one that suits their requirement and budget.

      2. Do Not Raise Small Claims

        The policyholder should not raise claims for minor damages as it hinders the chances of getting the No Claim Bonus. Hence it is advised to pay for minor damage repairs out of pocket and not claim them under the insurance policy.

      3. Utilize Accumulated NCB

        If you are an old car insurance policyholder and have not raised a claim in your previous years then you must be having a certain percentage of No claim bonus that you can use to reduce the car insurance renewal premium rates for your electric car.

      4. Install Anti-theft Device

        When you purchase a car insurance policy, the insurance company sends an inspector to check the condition of the vehicle to be insured. If you would install an ARAI-approved anti-theft device in your car then the insurer will provide you with a certain amount of discount on your car insurance policy.

      Wrapping It Up!

      Electric cars are slowly becoming popular in India and with the increasing fuel rates and pollution, they seem to take place of petrol/diesel engine cars in a few years. As it is recommended to purchase an EV insurance policy online, you can calculate the premium rates of the policy using a car insurance premium calculator and choose the right plan for your electric car.

      Find similar car insurance quotes by body type

      Hatchback Sedan SUV MUV
      Search
      Disclaimer: Policybazaar does not endorse, rate or recommend any particular insurer or insurance product offered by an insurer.
       Why buy from policybazaar

      Car insurance articles

      Recent Articles
      Popular Articles
      Things You Need to Know About SUV Car Insurance

      07 Dec 2023

      If you are planning to buy an SUV car, it is also essential that
      Read more
      All You Need To Know About Hatchback Car Insurance

      05 Dec 2023

      Investing in a hatchback can be a great option if you are looking
      Read more
      Does Your Car Insurance Cover Damages By Rat Attack?

      29 Nov 2023

      Considering the population of rats in our country, it is common to
      Read more
      All You Need to Know About Standalone OD Insurance

      29 Sep 2023

      The concept of Own Damage(OD) is not a new one. For those of us
      Read more
      Your Guide to Reducing the Chances of a Rejected Motor Insurance claim

      29 Sep 2023

      Filing a motor insurance claim can be a complex process, and
      Read more
      Check Vehicle/Car Insurance Status Online on Parivahan Sewa, Vahan, IIB & RTO
      It doesn’t matter if you are an excellent driver or take your car out only once in a few months, your car must be
      Read more
      How to Find Car Insurance Details by Registration Number?
      As a car owner, it is mandatory to have a car insurance policy under the Motor Vehicles Act 1988. However
      Read more
      Getting Your Duplicate Car Insurance Policy is Easy-Here’s How!
      Losing your car insurance documents can be daunting. In such a state of affairs, the first thing that comes to your
      Read more
      How to Transfer Car Insurance Policy?
      An integral part of selling a car for both the buyer and the seller is ensuring a successful car insurance transfer
      Read more
      Comprehensive Insurance Vs Third Party Insurance
      A comprehensive car insurance policy offers protection against third-party liabilities and own damages sustained by
      Read more

      top
      View Plans
      Close
      Download the Policybazaar app
      to manage all your insurance needs.
      INSTALL