The demand for electric vehicles (EVs) is picking up speed. In addition to being environmentally friendly alternatives to petrol and diesel cars, they can also be less expensive to maintain over time. EV sales have risen in popularity in India thanks to the Union Government’s fame II policy and the individual state government’s regulations.
Prospective purchasers might be concerned about how to choose suitable Electric Car Insurance, understanding that the EV market is still developing in India.
This review discusses the benefits, coverage, costs, and other details of the car insurance plans for electric vehicles offered in India. It discusses the significance of EV insurance and the fact that India still lacks standalone EV policies. A subsequent section of this report addresses the importance of electric vehicle insurance.
What is the purpose of electric vehicle insurance?
Electric vehicles are a quieter and more environmentally friendly alternative to traditional motor vehicles. Yet even they need an insurance policy.
Insurance providers cover electric vehicles against possible losses and damages caused due to accidents, natural disasters, or theft. An agreement between a person and the insurance provider is required to obtain electric vehicle insurance.
Insurance is a requirement under Indian law for all vehicles operating on Indian roads. Usually, diesel or gasoline is the fuel for a typical automobile. But EVs are charged by electricity.
Currently, insurance policies are in two categories.
Third-Party Vehicle Insurance
The Motor Vehicles Act of 1988 mandates that you have this policy for your EV insurance. You will get protected through this plan from legal obligations resulting from third-party injuries or property damage brought on by your electric vehicle. This policy does not cover damages to your car caused by accidents.
Comprehensive Automobile Insurance
Here is a perfect insurance plan for your electric car. It provides Own Damage and Third-Party (TP) coverage (OD). The repair costs are covered.
The benefits of electric vehicle insurance
Here are some benefits of getting a comprehensive insurance policy for your electric vehicle.
Protect yourself from third-party liability
Your insurance policy will cover these obligations and legal liabilities if an unforeseen scenario arises in which you injure a third party or harm their property.
Every car or motorcycle operating on Indian roads must have third-party insured coverage, according to the Motor Vehicles Act of 1988. Obtaining a car or bike insurance policy is mandatory for electric vehicles, with no exceptions. As a result, you will get shielded from penalties.
A Comprehensive Cover provides Own Damage (OD) coverage covering a significant portion of the repair costs in case of accidents, fires, natural disasters, mob violence, riots, and theft-related losses. If there is plan-covered damage, you will not be responsible for paying a high repair bill.
Buy personal accident insurance
You receive complete compensatory damages for unforeseen events like accidental death, physical injuries, or partial or total disabilities because of an accident with the legally required Personal Accident Coverage (PA). However, you must purchase this individually with the Comprehensive Plan or the Third-Party Insurance Plan.
To enhance the protection of your vehicle, you can add appealing add-ons to your electric car insurance policy. These include battery pack cover, no claim bonus cover, zero depreciation cover, roadside assistance cover, and more. All car insurance policies comprise these add-ons; and are available for a small additional cost.
What are the inclusions in your insurance?
The inclusions for electric vehicle insurance are as follows:
- Injury to a third party or destruction of third-party property
- Your car’s damages as a result of an accident
- Vehicle damage because of a fire or explosion.
- The accident-related death or injury of the owner-driver
- Natural catastrophes include things like earthquakes, floods, and storms.
- Rioting, vandalism, and additional human-created catastrophes
- Expenses related to car theft losses
What are the exclusions in your insurance for EV?
The following items don’t get covered by electric vehicle insurance:
- Damages brought on by mechanical or electrical failure.
- Damages resulting from regular wear and tear
- Damages resulting from careless driving
- Driving without a driver’s license
- You shouldn’t operate your electric vehicle while intoxicated by alcohol or other substances. Such situations do not fall under the coverage of accidents.
Electric vehicle insurance rates in India
The Insurance Regulatory and Development Authority of India (IRDAI,) the industry regulator, sets the premium for Third-party Car Insurance. Whereas, Comprehensive Car Insurance policy premiums vary between insurers.
The cost of third-party motor insurance increased as of June 1, 2022.
Long-term premiums for electric vehicles
A three-year insurance policy for a brand-new private electric vehicle (EV) with a power output of under 30 KW costs Rs 5,543. The three-year premium would be Rs 9,044 for an EV with a power output greater than 30 kW but less than 65 kW. EVs with more than 65 KW will cost Rs 20,907 each for three years of insurance.
A one-year third-party e-car insurance premium rate
Private cars under 30 KW will cost an additional Rs 1,780. Similarly, if the EV is more than 30 kW but less than 65 KW, it will cost Rs 2,904, and vehicles with more than 65 KW will cost Rs 6,712.
A one-year third-party e-bike insurance premium rate
The premium for two-wheelers up to 3 KW would be Rs 457, and for vehicles over 3 KW but under 7 KW, it would be Rs 607. Two-wheelers over 7 KW but under 16 KW must pay a premium of Rs 1,161, and vehicles over 16 KW must pay a premium of Rs 2,383.
What details should an EV owner provide the insurance company?
Electric vehicles get covered with the same liability coverage as fuel-powered ones. The insured declared value (IDV), or roughly how much the car is worth, can make all the difference. You only need to provide a few informational details—including the previous policy’s status – and instantly insure your EV.
Model of the vehicle
The insurance premium depends on the vehicle’s model. The important consideration when determining the IDV or insured declared value is the estimated market value of the EV.
Some areas get deemed high-risk, whereas others get considered low-risk. Therefore, the premium will be higher in high-risk areas than in areas where the risk is low.
Date of manufacture
The insurer can better understand the EV’s depreciation price by using the year of manufacture when calculating the IDV.
This is vital that you share your contact number to send Passwords (OTP), receive regular updates, and receive notifications about claims and deadlines, among other things.
Use of the vehicle
To determine whether the car is for personal or business needs, you must disclose this information.
How to find and maximize affordable electric vehicle insurance
Here are some suggestions for locating a cheap insurance plan for your electric vehicle.
You can compare the policies, extras, and services of various insurance companies in the industry using online services. It will assist you in locating the insurance policy with the best value along with optional features and services. You can instantly insure the car by providing information about the vehicle, yourself, and any prior policies (if still in effect). When you shop online, the process is simple and paperless.
Utilize any accrued No Claim Bonus (NCB)
You get a discount on the premium in exchange for not making any claims throughout the policy period. If no claims get made for five years in a row, the discounted value can reach 50%. Utilize the accumulated NCB to lower the cost of EV car insurance.
Decide on voluntary deductibility.
Voluntarily decide to pay a fixed amount as a deductible when filing claims. The voluntary deductible limit option reduces claim liability. Thus, the premium gets discounted for you. Nevertheless, choose a voluntary deductible if the likelihood of an increase in car insurance claims is lesser.
Install a theft prevention sensor.
You can avoid potential vehicle theft by installing an anti-theft device. Some insurers may reduce the premium because you’re attempting to lessen the likelihood of vehicle theft. Consequently, incorporating an anti-theft device can lower the cost of premiums.
Search for special offers
Some companies offer discounts on special occasions. Keep an eye out for these discounts to lower the cost of your EV insurance.
Where can I locate the best insurer for my electric vehicle?
You need to compare the services offered by various insurance providers to find the best insurer for your electric vehicle.
Which insurance policy is best for electric vehicles?
We recommend that you insure electric cars with a Comprehensive policy for extensive advantages. Damages to the insured vehicle are covered, in addition to third-party liabilities. You can also choose to extend the coverage by adding practical add-ons.
Why are insurance premiums higher for electric vehicles?
Electric vehicles (EVs) are environmentally friendly and inexpensive because they produce less harmful emissions. The driving scope of EVs is higher than that of their traditional gasoline-powered counterparts. Even so, compared to gasoline or diesel vehicles, they generally have higher insurance costs. It is so because EVs are more expensive, more prone to damage, are high maintenance, and require pricey repairs.
Here are the reasons for EV insurance premium increases.
Expensive electric vehicles
Modern technology is abundant in EVs, including high-capacity batteries, advanced auto components, and more. So, the IDV rises in direct proportion to the cost of the car, increasing the premium.
Electric vehicle components are pricey.
One of the reasons insurance premiums are higher is that fixing or replacing batteries is expensive. As battery prices decline, there is hope that insurance premiums may decrease.
EV batteries have a shelf life or an expiration date. Because replacement costs for lithium-ion batteries are high, insurance premiums are also higher. As the battery replacement cycle gets reduced, premiums will be lower.
Few mechanical experts
The servicing or repair of electric vehicles (EVs) requires highly qualified mechanics. The skilled workforce in India is currently smaller than it is for traditional car mechanics. Due to the high cost of hiring a specialized mechanic, the labor cost for the repair or replacement may be higher.
Wrapping it Up
Even as automakers use innovations to lower the cost of manufacturing EVs, maintaining electric vehicles is becoming more affordable. Insurance rates will inevitably fall as the cost of ownership and repairs both decline.
What if you are held liable for someone else’s injuries or damage to their vehicle? Insure your electric vehicle, regardless of the cost, and prevent unexpected financial losses.