Insurers No Longer See Electric Cars As A Niche Risk

With more electric vehicles (EVs) on UK roads than ever before, car insurers are broadening their offerings and competing more actively to attract EV owners. This marks a shift away from earlier concerns among early adopters, who often found themselves paying noticeably higher premiums than drivers of petrol or diesel cars.

Research from Consumer Intelligence reveals that 11 new insurance products for EVs were launched on a major comparison site last year, far more than the three or four typically introduced for petrol, diesel, or hybrid models.

At the same time, premiums are beginning to fall as well. Expanded repair networks mean electric vehicles can be repaired more efficiently, while growing claims data is helping insurers understand that EV drivers now carry a similar risk profile to those driving conventional cars. Some insurers have already reduced prices by almost 20 percent.

The more competitive stance is bringing benefits to insurers, too. One company boosted its “EV quotability” – how often it provides a quote – by 40 percent, which led to a 12 percent rise in its share of the top five price positions.

“As battery electric vehicles become more mainstream, insurers are no longer treating them as niche risks,” said Consumer Intelligence chief executive Ian Hughes. “That’s creating space for more confident, competitive pricing.”

However, the firm notes that EV cover can still be expensive compared with petrol and diesel. Although they tend to be involved in fewer collisions, repair bills are often higher because of the expertise required and the complexity of battery systems.

Regional differences are also emerging. London, a stronghold for electric car adoption, continues to record higher premiums than areas such as the north west of England. Factors like heavy traffic, theft rates and higher levels of claims contribute to the disparity.