In a NutshellCar insurance for electric vehicles tends to be more expensive than for traditional gas-powered automobiles. Higher purchase prices, repair costs and limited repair facilities make insuring these cars more expensive than you may think.
Electric vehicles (EVs) have been rising in popularity as people look for an alternative to gas-fueled cars.
If you’re considering buying your first electric car, you may be wondering if car insurance works the same for EV cars and gas-fueled cars. While coverage typically works the same way, insurance tends to cost more and isn’t as widely available for EV cars.
In general, insuring an electric car costs more than a traditionally fueled vehicle. Not all car insurance companies offer coverage for electric cars. Here’s more of what you should know about car insurance for EVs before you buy your first electric car.
- Electric car insurance vs. conventional car insurance
- Which companies provide electric vehicle insurance?
- How to save on electric car insurance and other costs
- Benefits of driving EVs
- Next steps
Electric car insurance vs. conventional car insurance
You’d think insuring an electric car would cost about the same as insuring a conventional vehicle. You may be surprised to find out that isn’t usually the case. Typically, insuring an electric car costs more than insuring its traditional counterpart.
Insurance companies aim to profit from the policies they write. To do so, they must evaluate the costs of insuring a vehicle to price those policies properly. When a newer type of car arrives on the market, insurance companies must account for uncertainties or potentially higher costs.
For instance, electric cars may have more expensive replacement parts and fewer certified repair facilities. When you add in the fact that EVs usually cost more to buy than a traditional car, it makes sense that EV insurance would likely cost more than typical car insurance. Even though you might save money avoiding the gas station, the increased car insurance cost could eat into your savings.
Which companies provide electric vehicle insurance?
Many major insurers offer EV insurance, including:
- Liberty Mutual
If you live in a state where Tesla offers Tesla insurance, you can insure your Tesla EV with the company. Tesla owners in Arizona, California, Colorado, Illinois, Ohio, Oregon, Nevada, Texas and Virginia may qualify through the Tesla app.
Tesla says its insurance is competitively priced because the company intimately understand its cars and their technology, repair costs and safety record.
Check with Tesla insurance to see if it provides the standard types of auto insurance coverage you’ll need, from liability to collision and comprehensive coverage (Tesla doesn’t list options on its site). Tesla may also offer specialty coverages related to owning an electric car, such as coverage for wall chargers.
How to save on electric car insurance and other costs
When buying a new electric car, look for federal, state and local tax incentives for purchasing an EV. Verify whether your specific car qualifies for a tax incentive, as some manufacturers may no longer qualify after producing a certain number of vehicles.
Saving money on EV car insurance works much the same as saving money on traditional car insurance. By avoiding accidents, claims and driving violations, you’ll help keep your insurance rates down. Keeping your credit on track also can help your credit-based insurance score, which insurers use to help predict how likely you are to file a claim.
When getting new insurance or considering switching carriers, always get multiple car insurance quotes. Each company may rate the risk of having you as a customer differently, resulting in varying premiums. Make sure to ask for any discounts you may qualify for, including any driver education course or electric vehicle discounts.
Benefits of driving EVs
Electric vehicles may provide many benefits depending on your circumstances. Some people focus on the environmental impact of reduced emissions because these cars don’t burn gasoline to fuel their engines. The electric motors also offer a unique driving experience that could be more fun for some car owners, too.
Drivers may appreciate the cheaper cost to recharge a car’s battery versus refilling a traditional car’s gas tank. These costs vary by area and may change if gas or electricity prices change.
When looking at expense, though, it’s a good idea to get a feel for the cost of gas cars versus electric cars generally.
Now that you have a better idea about the cost of EV insurance, if you still want to move forward with an electric vehicle purchase you might want to learn about how to possibly offset some of that expense with electric vehicle tax credits. That could help you save on the purchase cost of your EV.