Is Hybrid Car Insurance Cheap or Expensive?

Hybrid car insurance is typically more expensive, with a hybrid costing 7% to 11% higher on average than its traditional gas-powered counterpart. This increased cost is primarily due to higher purchase and repair costs associated with hybrid vehicles, as well as specific factors like the vehicle's make and model, driver's location and driving record. That said premiums can vary considerably since insurance companies will also consider the driver’s annual mileage and driving history among other factors, when calculating rates.

Key Takeaways A hybrid can cost up to 11% more on average to insure than a traditional gas-powered vehicle equivalent. The purchase prices of hybrid vehicles are 20% higher than gasoline cars, which contributes to their higher insurance premiums. Repairs for hybrids are costlier and can be more complex, with battery replacements alone costing between $3,000 and $8,000. Some insurers offer specific discounts for hybrid cars, such as Farmers and Travelers, although the discount rates are not explicitly stated.

How Much Does It Cost To Insure a Hybrid Car?

Hybrids can cost more to insure, with rates being 7% to 11% higher than those for a common gas-powered vehicle.^[1] To get a simplified idea of this higher price point: If you were paying for $1,000 to insure a traditional gas-powered car, then it may cost an extra $70 to $110 to insure a hybrid vehicle. The table below shows the cost of coverage for certain hybrid models.

Vehicle Type	Year	Average Monthly Cost
Toyota Prius	2024	$126.26
Volvo XC60	2023	$185.18
Lexus RX	2024	$288.80
Lexus ES	2024	$718.93

^{*Data is based on drivers between 40 and 49 years of age. The vehicles listed reflect the most current data available through SmartFinancial.}

Factors that dictate hybrid car insurance rates are similar to normal car insurance:

• Driving record
• Age and experience
• Location
• Type of vehicle
• Coverage types and deductibles
• Credit score (not allowed in every state)^[2]
• Annual mileage
• Gender (not allowed in every state)^[3]
• Marital status
• Usage of the vehicle
• Insurance history

Are Hybrids Cheaper To Insure Than Electric Cars?

Generally, electric cars tend to be more expensive to insure than hybrids, which is partially due to the higher cost of buying an EVs compared to most hybrids. Hybrids, on the other hand, combine traditional combustion engines with electric motors and can therefore be more familiar to mechanics, potentially resulting in lower repair costs.

Why Is Hybrid Car Insurance Expensive?

Higher purchasing and repair costs add to higher insurance premiums for hybrids. Fire risks and the possibility of higher drive times can also add to increased auto insurance rates.

Higher Initial Cost

Hybrid vehicles often cost up to 20% more to buy than traditional gasoline-powered vehicles. Prices range from about $20,000 for the most affordable hybrids to over $100,000 for high-end luxury models.^[4]

The higher value of the vehicle can lead to higher insurance premiums, as the cost to replace in the event it is totaled is greater.

Repair Costs

Hybrids are more expensive to maintain as they can be complex and expensive due to the interconnected nature of the transmission, combustion engine and electric motor. A fault in one component can affect the others, requiring diagnostics by certified technicians. In addition, battery replacements cost $3,000 to $8,000, which can carries a hefty price tag if you need to replace it after an accident.^[5]

They Can Be Driven More

Hybrid vehicles generally don’t use as much gasoline as their more common gas-powered counterparts, meaning people may opt to drive more often since they can travel further with less fuel. The more time you spend on the road, the more likely you’ll get into a car accident. Because of this car insurance companies increase premiums for hybrid drivers.

Higher Risk of Fire

Hybrid vehicles have a 3.5% chance of catching fire over its lifetime due to the combination of a gasoline engine, high-powered electric system and battery, which generates significant heat under the hood.^[6] A risk like this is an obvious red flag for insurance companies, meaning insuring a hybrid will likely be more expensive than insuring a gas-powered car.

Higher Risk to Pedestrians Due to a Quieter Vehicle

Hybrids can pose a potential risk to pedestrians because of how quiet they can be.

In fact, a new rule requires electric and hybrid cars to make noise to help blind or visually impaired people know they're nearby.^[7] This rule follows the 2010 law for safer streets and affects cars, trucks, vans and slow-moving vehicles that can drive without using a regular engine.

What Type of Insurance Do You Need for a Hybrid Car?

To start, you will always need to meet your state’s minimum car insurance requirements, which most commonly includes liability insurance. In some states, you may also be required to have medical payments coverage, personal injury protection and uninsured motorist insurance. Keep in mind that if you’re financing or leasing your car, then you will also be required to maintain collision and comprehensive coverage to insure your hybrid vehicle against physical damages.

You may also want to expand beyond these protections by adding roadside assistance, which covers roadside emergency services in case you need a battery jumpstart, a town or a locksmith. In addition, mechanical breakdown insurance may also be a good idea to cover a mechanical or electrical failure that isn’t covered by one of the above coverages or your car warranty.

Finally, new car replacement coverage may be worth buying since hybrids can be expensive and collision and comprehensive insurance will only pay out the actual cash value of your vehicle if it is totaled. If you add this coverage to your policy, it will instead pay to replace your vehicle with the same make and model and not just the car’s depreciated value.

Do Insurance Companies Offer Discounts for Hybrid Cars?

Some insurance companies do offer a hybrid car insurance discount. Notable insurance companies include Farmers and Travelers.^[8][9] However, they do not state how much of a discount customers can get. Keep in mind that the Farmers green vehicle discount is only available for California residents.^[8]

How Else Can I Get Insurance Discounts for a Hybrid Car?

There are plenty of other discounts available by many providers, including:

1. Safe driver discount: For drivers with a clean driving record, i.e., no accidents or traffic violations over a certain period.
2. Good student discount: For young drivers who maintain a good GPA.
3. Anti-theft device discount: For vehicles equipped with anti-theft systems, like car alarms or tracking devices.
4. Bundle discount: For those with more than one type of insurance policy (like home and auto) with the same company.
5. Multi-vehicle discount: For policyholders who insure more than one vehicle with the same insurance company.
6. Low mileage discount: For drivers who drive less than a certain number of miles per year. Useful for people who work from home or use their car infrequently.
7. Defensive driving course discount: For drivers who complete an approved defensive driving course.
8. Military discount: For active, reserve or retired military personnel.
9. Loyalty discount: For customers who have been with the same insurance company for several years.
10. Payment discount: For customers who have their premium automatically deducted from their bank account when payment is due or who pay their premium in full instead of monthly or quarterly.

How To Get Hybrid Car Insurance

As you explore insurance options, it's wise to gather three to five quotes from various insurers. Each company will need details about you and your vehicle – like its make, model and year, along with your driving history, birth date and driver's license number. Gathering this information for multiple carriers can be time-consuming.

Thankfully, platforms like SmartFinancial simplify this task. By completing a single questionnaire about your insurance needs and financial preferences, you can quickly find a tailored commercial insurance policy. Reach out to an agent now to discuss your complimentary auto insurance quote.