Property and Casualty Insurance (C) Committee
Thursday, August 15, 2024
12:30 PM CDT
McCormick Place Convention Center—S102—Level 1
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Electric Vehicle Insurance Rates
Background
Last Updated: 2/27/2024
Issue: Unlike traditional internal combustion engine (ICE) or gas-powered vehicles, electric vehicles (EVs) are powered by an electric battery. Hybrid cars are powered by a combination of the electric battery and ICE, usually falling back on the ICE when the electric battery runs out of charge. EVs may cost more to insure than ICE vehicles for various reasons. EVs are generally more expensive to purchase than gas-powered vehicles, their batteries are expensive to repair and replace, and a limited number of repair shops specialize in EV repair.
Background: With the number of EVs on the road expected to increase by , concerns regarding insurance regulations and costs become more pressing. On average, EVs cost up to  to insure per month than gas-powered vehicles, with the .
There are several reasons behind this increase in cost, including Because EVs have risen in popularity so recently, the replacement part market and availability of specialized labor to repair them have not kept pace with growth. While . In short, EVs and their parts are scarcer and more expensive in general, resulting in higher insurance rates. Additionally, and often require a specialist. In many cases, replacing an electric battery is , despite the battery representing
Once EVs become more common, parts are more easily accessible, and they gain a more extensive claim history, their insurance rates may drop because they have lower claim frequencies than ICE vehicles of the same make and model. In December 2020, the Highway Loss Data Institute (HLDI) published an article that found . As more people purchase and drive EVs However, due to the price tag attached to EVs,
Actions
Status: The Property and Casualty Insurance (C) Committee is charged with monitoring and responding to issues associated with the property/casualty (P/C) and auto insurance markets in the U.S. The Transparency and Readability of Consumer Information (C) Working Group is charged with updating and developing a web page and mobile content for A Shopping Tool for Automobile Insurance
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