Before Purchasing An EV, Evaluate It From An Insurance Perspective
As fuel prices rise, electric vehicles (EVs) are gaining popularity due to their cost-effectiveness and minimal environmental impact. Despite the vehicle type, safeguarding your finances from potential damages remains crucial.
Preserving The Batteries, The Most Expensive Component Of An EV
EV owners can purchase standard insurance plans for their electric vehicles (EVs) like internal combustion engine (ICE) vehicle owners. These plans cover all aspects of an EV, including its costly lithium-ion battery. EV batteries usually have a five- to eight-year warranty and require minimal maintenance, lasting up to ten years. Comprehensive electric car insurance can often cover a replacement if the battery gets damaged, even after eight years. Claims are subject to terms and conditions set forth under the motor insurance policy.
According to general insurers, EV insurance demand is increasing, but safety concerns could result in higher premiums.
The Key Is To Understand The Specifics Of The Fundamentals
A car insurance policy’s two essential parts are third-party and own-damage coverage. It would help if you had third-party insurance to protect yourself financially in case an EV battery catches fire or a traffic accident results in a third party’s passing away, physical harm, or property damage. The damage cover is optional, but it provides financial protection against damage to your car resulting from collisions, flooding, and other unforeseen external factors. *
Using an EV manufacturer’s or OEM-approved charger ensures fire damage during charging is covered by the own-damage policy. Using a non-OEM charger means no coverage. Understanding these details and your policy’s inclusions and exclusions is crucial for the right electric car insurance choice.
The Premium Puzzle
Electric vehicle insurance premiums are comparable to those for ICE vehicles. The Ministry of Road Transport and Highways increased the third-party premium rate for different categories of ICE vehicles as of June 1. EV owners continue to receive a 15% concession on the third-party premium rate. However, factors like the insured declared value (IDV) and the car’s location affect the own damage insurance premium. Make use of the car insurance calculator to estimate the costs of your premium.
Protecting The EV’s Value
Comparatively speaking, EVs are more expensive than ICE vehicles. To protect your finances in the event of a total loss of your vehicle, it is crucial to choose the appropriate IDV for your vehicle. Your insurer may pay the IDV, the maximum amount you decide if your EV is stolen or suffers irreparable damage. Lowering the IDV below the market value of your vehicle increases liability and results in a lower payout from the insurer, even though a higher IDV indicates a slightly higher premium. Setting the appropriate IDV may help to protect your EV significantly.
You can enhance your EV insurance with options like zero depreciation, return-to-invoice, EMI protection, no claim bonus, and consumable expenses protection covers. These add-ons are beneficial in the long run because EV parts are costlier than those for ICE vehicles. *
While the EV market in India is still emerging, it offers quiet, low-maintenance, and eco-friendly driving. Insurance for EVs is mainly similar to that of ICE vehicles, with a 15% concession on third-party premiums for EVs. Understanding electric vehicle insurance now can help you make informed choices for your future car based on your needs.
*Standard T&C Apply
Insurance is the subject matter of solicitation. For more details on benefits, exclusions, limitations, terms, and conditions, please read the sales brochure/policy wording carefully before concluding a sale.
