Everything you need to know about insuring an electric vehicle
Convenience, fuel savings, and environmental benefits are just a few of the reasons why drivers opt for an electric vehicle. However, while making the switch can provide numerous benefits, you should consider the big picture of electric vehicle ownership. How much does it cost to insure an electric car versus a gas car, for example? Understanding how to best insure an electric vehicle will not only save you money, but will also ensure that you have the proper coverage for your new purchase.
Electric car insurance vs. conventional car insurance
In most cases, insuring an electric vehicle will cost more than insuring a conventional automobile. This is primarily due to the higher purchase price of an electric vehicle as well as the fact that electric vehicles generally have higher repair costs, particularly those with expensive technology features.
For example, auto insurers are aware that replacing an electric vehicle will likely cost more than replacing a conventional vehicle. Similarly, if even a minor accident damages an electric vehicle's battery pack, the cost to replace this critical component may exceed $15,000.
How much does electric car insurance cost?
Although electric vehicles are typically more expensive to insure than gas-powered counterparts, StrongInsurance analyzed premiums for several makes and models using data provided by Quadrant Information Services to provide insight into how costs are affected when insuring an electric vehicle.
Electric vehicle (2022 model) | Average 6-month premium | Average annual premium |
Audi e-tron | $2,134 | $4,268 |
Chevy Bolt | $915 | $1,830 |
Hyundai Ioniq | $1,201 | $2,402 |
Ford F-150 Lightning | $980 | $1,960 |
Nissan Leaf | $902 | $1,804 |
Polestar 2 | $1,213 | $2,426 |
Rivian R1T | $1,495 | $2,989 |
Tesla Model 3 | $1,306 | $2,612 |
Tesla Model S | $2,033 | $4,066 |
Tesla Model X | $2,097 | $4,193 |
Toyota Prius | $870 | $1,740 |
These are only averages. The cost of insurance for your electric vehicle is determined by a number of individual rating factors.
Who provides electric car insurance?
Insuring an electric vehicle is the same as insuring a conventional vehicle. Liability, bodily injury, collision, and comprehensive coverages are all available with electric car policies. According to the Insurance Information Institute (Triple-I), most national and regional auto insurers write policies for electric vehicles, including:
- Allstate
- Farmers
- Geico
- Liberty Mutual
- Nationwide
- Progressive
- State Farm
- USAA
While several major auto insurers have begun to dip their toes into the electric/hybrid vehicle market by offering guides on the subject (see Allstate, Geico, Farmers, and State Farm), you may have difficulty finding discounts for your electrical vehicle. While you can expect to save money by avoiding the gas station and possibly benefiting from tax breaks, many insurance companies do not currently offer discounts to drivers who choose an electric vehicle.
Having said that, we did find a couple who are. Electric and hybrid car owners receive exclusive discounts from some large carriers, including Travelers and Liberty Mutual.
Tesla Insurance
Tesla owners can purchase Tesla Insurance via the mobile app. It provides all mandatory car insurance coverage, such as bodily injury and property damage liability, collision and comprehensive insurance. Tesla Insurance is unique in that it rates a driver's car insurance policy based on real-time driving habits and behaviors as tracked by features within the Tesla itself, and this rating may change based on the vehicle's monthly Safety Score. Car insurance rating factors such as age, claims history, and credit, among others, are not used to rate drivers. Instead, Tesla analyses the type of vehicle you drive, where you live, how frequently and safely you drive, and the coverage you choose.
Tesla also offers an Autonomous Vehicle Protection Package for drivers who want to use the autonomous driving feature, which includes autonomous vehicle owner liability, cyber identity fraud expenses, electronic key replacement, and wall charger coverage.
Tesla Insurance is currently only available in the following states: Arizona, Colorado, Illinois, Nevada, Ohio, Oregon, Texas, and Virginia. It is available in California, but it does not base rates on telematics data. Furthermore, if you own a Tesla but also own other vehicles, you can insure them with a Tesla policy.
How to save on electric car insurance
If you decide to buy an electric vehicle, you can save money on insurance by doing the same things that regular car owners do: avoiding accidents and traffic violations. If you already own an electric vehicle and are looking for more affordable rates, consider requesting quotes from several providers. Switching to another company may provide you with a better deal.
You can also benefit from discount programmes. According to the Triple-I, insurers offer a variety of discounts for purchasing multiple policies, insuring more than one vehicle, remaining claims-free, and taking a defensive driving course, among other things.
In addition, look into local, state, and federal programmes that provide rebates or tax credits for owning an electric vehicle. The California Clean Vehicle Rebate Project, for example, offers rebates of up to $4,000 to California residents who purchase an eligible electric battery vehicle. The federal government provides tax credits of up to $7,500 for the purchase of certain electric cars and SUVs.
What are the benefits of driving electric vehicles?
Owning an electric or hybrid vehicle has more advantages than you may realize. Here are a few examples:
- Energy independence: While you must use a charging station to recharge your vehicle's battery, you can say goodbye to gas stations. You can plug in your car when you get home from work and it will be ready to go the next morning if you have a home charging station.
- Reduced environmental impact: Electric vehicles emit no tailpipe emissions. While driving an electric car will not eliminate your carbon footprint in transportation, it will significantly reduce it. Furthermore, hybrid electric vehicle models use either gasoline or battery energy and are a popular option for those who are not yet ready to commit fully to an all-electric vehicle.
- Reduce inhaled emissions: Tailpipe emissions pollute both the environment and the interior of your vehicle to varying degrees, depending on factors such as vehicle type and climate control system. Many dangerous carcinogens are present in automobile emissions, including volatile carbon oxides, organic compounds, and particulate matter. An electric vehicle can help you avoid breathing in these pollutants.
- Reduce fuel costs: Typically, the cost of fueling an automobile with gasoline or diesel is greater than the cost of operating an electric vehicle.
- Extended battery life: Reports on the performance of electric car batteries vary greatly. However, according to the National Renewable Energy Laboratory's predictive modeling, new technology has extended the life of some types of batteries by up to 12 to 15 years. And research into ways to extend the battery life of electric vehicles continues.
- Reduce maintenance costs: With an electric vehicle, you don't have to worry about regular oil changes or replacing incidental parts like fan belts, gaskets, and radiator hoses on a regular basis. Some electric vehicle owners have reported driving their vehicles for 70,000 miles or more on the original brake pads.