7 Factors To Consider When Buying EV Insurance

Electric vehicle insurance comes with the same basic coverage as traditional car insurance. As with gas-powered vehicles, drivers are typically required to have liability coverage depending on where they live. The cost of electric vehicle insurance varies. However, your insurance will probably be higher for your electric vehicle due to its higher value and cost of repairs. Luckily, many of the major insurance carriers offer discounts for electric vehicles.

If you’re in the market for an electric car, keep reading to learn everything you’ll need to know when insuring your new vehicle.

What Does Electric Car Insurance Cover?

Electric car insurance offers the same basic vehicle coverage afforded to gas-powered vehicles so you can get the coverage you need. Below is a list of available coverages:

  • Liability coverage - Liability coverage is required in most states except New Hampshire and Virginia. It is divided into two types, bodily injury liability coverage and property damage liability coverage. Bodily injury liability coverage helps cover medical costs for those who are injured in a car accident that you are responsible for. Property damage liability coverage helps cover the costs of repairs or replacement of property in a car accident you are responsible for.
  • Collision coverage - Collision coverage helps pay damages to your vehicle caused by an accident regardless of who is at fault. Although collision coverage is optional coverage that is not required by law, if you are leasing your car or you have an auto loan, the leaseholder or lender may require you to have collision coverage.
  • Comprehensive coverage - Comprehensive coverage helps pay to repair or replace your vehicle if it is damaged by something other than a car accident. The Insurance Information Institute lists fires, falling objects, explosions, earthquakes, windstorms, hail, floods, vandalism, riots and collision with animals as covered perils.
  • Emergency road service - Emergency roadside service can help provide coverage for the cost of:
    • Mechanical labor
    • Towing to the nearest mechanic
    • Delivery of gas, oil, battery or change of tire (Emergency road service won’t necessarily cover the cost of the item itself)
    • Locksmith, if the keys are lost, locked inside the vehicle or stolen
  • Medical payments coverage (Med Pay) - Medical payment coverage helps pay for the costs associated with medical bills or funeral costs for you or your passengers if there is an injury or death due to an accident regardless of who is at fault.
  • Personal injury protection (PIP) - Personal injury protection helps provide financial support towards costs you or your passengers incur due to a covered accident. Costs include childcare, grocery delivery fees, lost income or medical expenses. States that require this coverage are:
    • Delaware
    • Florida
    • Hawaii
    • Kansas
    • Kentucky
    • Massachusetts
    • Michigan
    • Minnesota
    • New Jersey
    • New York
    • North Dakota
    • Oregon
    • Pennsylvania
    • Texas
    • Utah
  • Uninsured and underinsured motorist coverage - Uninsured and underinsured motorist coverage provides protection to you in the event you're involved in an accident that is caused by someone who does not have car insurance or by someone whose auto insurance is not adequate enough to cover the damages you incurred.
Roadside assistance coverage can help with the costs associated with including recharging an EV.

Are My EV Battery and Charging Equipment Covered?

Comprehensive coverage may include protection for portable electric vehicle chargers that are commonly used for electric vehicles in drivers’ homes.

What Happens if I Run Out of Battery on the Road?

Roadside assistance coverage can help with the costs associated with automobile breakdowns, including battery recharge. Many electric cars also have a buffer built into their system allowing you the ability to get your car to a charging station even if your battery reads as depleted. A Tesla Model 3, for example, can drive nearly 26 additional miles before power to the wheels stops. This range varies from one electric car to another, so always be sure to keep your car charged and ready.

How Much Does Electric Car Insurance Cost?

The cost of electric car insurance varies due to a number of factors. These factors include:

  • Your background
  • Driving history
  • Car model
  • Deductible
  • Number of drivers
  • Mileage
  • Driving behaviors
  • Your State
  • Additional coverages

Electric cars will usually be more expensive to insure than their gas-powered counterparts. This is because claims tend to be higher for electric cars due to electric cars being more expensive to repair or replace. One of the largest factors is the battery pack. Smaller accidents such as minor fender benders can cause damage to the battery which can cost anywhere between $5,000 to $15,000 to replace, not including labor. Electric vehicles are also relatively uncommon still, so finding a mechanic who can properly fix one is more challenging.

Which Companies Provide EV Insurance?

Many insurance carriers offer coverage for electric cars, including:

  • Allstate
  • American Family
  • Auto-Owners Insurance
  • Country Financial
  • Farm Bureau
  • Farmers
  • Hanover
  • Kemper
  • MAPFRE
  • Nationwide
  • State Farm
  • Travelers
  • USAA*
Electric car insurance offers the same basic vehicle coverage afforded to gas-powered vehicles.

Tesla has begun to offer Tesla Insurance for those who drive their cars. Their system uses telematics, devices used to collect data about a vehicle's location, speed, and other information. This data is then transmitted wirelessly to the insurance company where it can be used to calculate premiums.

*USAA is available only to active military, veterans, and their families.

Electric Car Insurance - Get Affordable Rates

Will My Insurance Provider Give Me a Discount if I Have an EV?

In our research, Travelers and Farmers offer discounts specifically for electric vehicles. Also, electric cars bought in 2010 or later may be eligible for a federal income tax credit of up to $7,500. The amount varies based on the capacity of the battery for your vehicle. State/local incentives may also apply.

How To Save on Electric Car Insurance

There are various discounts available for electric vehicle drivers depending on the insurance provider and your situation. Below is a list of auto insurance discounts to ask your insurance agent about:

Electric cars will usually be more expensive to insure than their gas-powered counterparts.

Are There Any EV Insurance Add-Ons That I Should Consider?

Liability coverage is required in most states except in New Hampshire and Virginia. In addition to liability insurance, there are a number of add-ons you may wish to consider. They include:

  • Collision coverage
  • Comprehensive coverage
  • Emergency road service
  • Medical payments coverage (Med Pay)
  • Personal injury protection (required in some states)
  • Uninsured and underinsured motorist coverage

Is Comprehensive Insurance Mandatory For Electric Cars?

Comprehensive insurance coverage is not mandatory. Most states will, however, require bodily injury liability coverage and property damage liability coverage at minimum, plus PIP if you live in a no-fault state.

Are There Downsides To Owning an Electric Vehicle?

The largest downside to having an electric car is repairs. This is especially true if the battery is damaged, because replacing it will cost between $5,000 to $15,000. The amount of time it takes to fully charge the battery for an electric car is also a negative factor. Depending on the car and the type of charger you’re using, it may take up to 12 hours until the battery is fully charged. Compare that to the average five minutes someone spends at the gas pump when filling up their car with gas.

Electric Car FAQs

Do I need extra homeowners insurance if I have an EV?

You won’t need additional homeowners insurance to cover your electric vehicle itself, however, you may need comprehensive coverage to protect a charging station in your home. For instance, a NEMA 14-50 outlet is directly hardwired into your home and provides a 240-volt charge for your electric car which cuts down on charge time.

Do electric vehicles cost more to insure?

Electric vehicles generally cost more to insure because of the higher costs required to repair or replace parts as compared to a gas-powered vehicle.

Does owning an electric vehicle increase my insurance risk?

Owning an electric vehicle doesn’t increase your insurance risk as a driver.

Key Takeaways

  1. Electric car insurance offers the same basic coverage as standard coverage, including collision coverage, comprehensive coverage, emergency road service, medical payments coverage (Med Pay), personal injury protection (required in some states) and uninsured and underinsured motorist coverage.
  2. The cost of electric car coverage is more expensive than traditional car coverage due to the higher cost of repair or replacement. Prices vary depending on a number of factors such as your background, your driving history, the car model, your deductible, the number of drivers being insured, your mileage, your driving behaviors, the state you live in and any additional coverages you tack onto your policy.
  3. Your insurance provider offers a number of auto insurance discounts you may qualify for. Contact your insurance company and find out what discounts are available.
  4. Many major carriers like Allstate, American Family, Nationwide, State Farm, Travelers and USAA offer electric car insurance. Tesla offers its own insurance that bases its premiums on telematics.
  5. A major downside to owning an electric car is the cost of repair which can be as high as $15,000 if the battery alone is damaged.

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