Are Electric Cars More Expensive to Insure

As electric cars become increasingly popular on UK roads, many drivers are weighing up the practical and financial implications of making the switch. While much has been said about fuel savings and environmental benefits, insurance is another area worth careful consideration.

So, are electric cars more expensive to insure? The answer is not straightforward. Some electric vehicles (EVs) do cost more to insure than petrol or diesel models, but this depends heavily on the make, model, driver profile and how insurers assess the risks involved.

This article looks at why insurance costs for EVs can differ, how premiums are calculated, and what you can do to reduce your costs if you are planning to go electric.

Why Might Electric Car Insurance Cost More?

There are several reasons why electric vehicles may carry a higher insurance premium than their petrol or diesel counterparts.

First is the purchase price. Electric cars tend to be more expensive to buy upfront. Insurers base part of your premium on how much they might need to pay out if your vehicle is stolen or written off. Higher values usually lead to higher premiums.

Second is the cost of repairs. EVs have fewer moving parts overall, but they often require specialist parts and qualified technicians. Batteries and components specific to EVs, such as electric motors or complex software systems, can be expensive to replace. Not all repair garages are currently equipped to handle electric vehicles, and insurers may factor that into their pricing.

Third is the availability of replacement parts. Lead times on EV components can be longer, especially for less common models. This increases the potential cost of a claim and can affect premium calculations.

Finally, there is the vehicle insurance group to consider. Every car is assigned to an insurance group from 1 to 50, based on things like performance, safety features and repair costs. Many EVs fall into higher insurance groups, particularly if they are fast or technologically advanced.

Are All Electric Cars More Expensive to Insure?

Not necessarily. While some EVs do have higher insurance costs, this is not true across the board.

Cheaper, lower-powered electric cars, such as the Fiat 500e or Renault Zoe, can have similar or even lower premiums than small petrol hatchbacks. These models are often designed for urban use, fall into lower insurance groups and tend to be driven by more cautious drivers, which insurers take into account.

On the other hand, performance-focused EVs such as Teslas or the Porsche Taycan often sit in the highest insurance groups due to their value, speed and technology.

Ultimately, insurance costs are not determined solely by whether the car is electric, but by a combination of factors, including:

• Vehicle value

• Insurance group

• Performance characteristics

• Battery size and replacement cost

• Likelihood of theft or damage

• Cost of replacement parts

• Your driving history and location

Other Factors That Influence EV Insurance Costs

Like any type of vehicle, your personal circumstances have a major impact on your insurance premium. Insurers will consider:

• Your age and driving experience

• No-claims bonus

• Where you live and park the car

• Annual mileage

• Use of the vehicle (personal, commuting or business)

• Additional drivers on the policy

If you are a young driver, your premium will be higher regardless of vehicle type. However, some insurers are beginning to offer tailored EV policies with features like battery cover, charging cable protection and lower rates for lower-emission vehicles.

Is EV Battery Insurance a Separate Issue?

For most electric car owners, the battery is included in the insurance policy. However, some lease arrangements or older vehicle finance plans involve battery leasing, where the battery is owned separately from the car.

In those cases, you will need to check that your insurer covers the leased battery or that the lease provider has arranged appropriate insurance. If the battery is included in the car purchase, which is now the norm, it will be covered as part of your comprehensive insurance policy.

Battery damage from collisions, fire or theft is typically included, though general wear and tear or degradation is not. Always check policy terms to understand exactly what is covered.

Will Insurance Costs Fall as EVs Become More Common?

There are signs that EV insurance is becoming more competitive as the market matures. More insurers are offering specialist EV policies, and as repair networks improve and more data becomes available, underwriting risk will become more accurate.

As repair costs come down and electric cars become mainstream, the gap between EV and petrol/diesel insurance is likely to shrink. This is already happening in some segments of the market, particularly with smaller electric vehicles used for city driving.

Government incentives, lower running costs, and zero road tax on many models also help offset the slightly higher insurance premium in many cases.

How to Reduce Insurance Costs for Your Electric Car

If you want to keep your EV insurance premium as low as possible, many of the usual strategies apply:

• Compare quotes across multiple insurers

• Increase your voluntary excess

• Park off-street or in a garage if possible

• Consider adding a more experienced named driver

• Avoid modifications that could increase performance

• Use telematics or black box policies if you are a new or young driver

• Choose a model in a lower insurance group

You should also consider using an insurer that specialises in electric vehicles. Some providers offer EV-friendly cover with extras like cover for charging cables, wall boxes or roadside recovery to the nearest charging point.

Summary: Are Electric Cars More Expensive to Insure?

Electric cars can be more expensive to insure, but this is not a fixed rule. Premiums depend on the vehicle type, insurance group, repair costs, and driver profile.

While some EVs do carry higher premiums due to their value and specialised parts, many smaller models are now priced competitively with their petrol or diesel counterparts.

As the EV market grows and insurers gain more experience, the cost of insurance is expected to become more balanced. In the meantime, shopping around, choosing the right vehicle and understanding what your policy covers are key steps in managing the cost of EV ownership.

For many drivers, the long-term savings on fuel, maintenance and road tax can outweigh a slightly higher insurance premium, making electric vehicles a financially and environmentally smart choice.