The age of the combustion engine is coming to a close – but be careful to stay on track
Source - Daily Telegraph - 21/05/23
As Britain edges towards its “net zero” future, the way we drive is being slowly but surely electrified. According to current timelines, 2030 will mark a milestone for petrol-powered vehicles, with car manufacturers facing a ban on selling traditional combustion engines.
However, the road to widespread electric adoption is paved with scepticism, as many drivers remain hesitant to embrace battery-powered vehicles.
According to a recent survey by Forbes Advisor, two in five drivers are calling for the 2030 target to be abandoned altogether, expressing limited enthusiasm for electric vehicles (EVs).
Additionally, an overwhelming two-thirds of respondents believe that Britain is not yet prepared for such a ban. The main obstacle cited by the majority of participants was the steep price tag associated with EVs, which acts as a barrier preventing them from making the switch to greener alternatives.
Indeed, it is no secret that electric cars come with a higher upfront cost compared to their petrol-powered counterparts – and the infrastructure necessary to support an emissions-free future is still a work in progress.
The waters get murkier when it comes to car insurance. Generally, most insurance providers cover both types of car under similar policies. But, for those who are prepared to make the switch, there are some pitfalls to navigate when it comes to insuring an electric car.
EV policies can come with more caveats
You don’t need specialist car insurance for an EV – although it is available. Most insurance providers offer policies suitable for EV drivers, so you shouldn’t have an issue finding cover.
There are specialist EV insurance providers, which offer insurance packages designed specifically for electric vehicles. These packages often come with additional benefits, such as the provision of like-for-like EV courtesy cars and a more personalised level of service. It's important to note that certain specialist insurers may have specific criteria for insuring vehicles.
For example, some providers have limitations on the maximum value of the cars they cover, or may require you to have at least one year of no-claims to qualify for coverage.
EV premiums can be more expensive
It has been reported that EVs are typically more expensive to insure than their petrol counterparts, but this is not necessarily true. Figures from CompareTheMarket, a comparison site, show the average premium for an EV is currently more expensive than for petrol cars, but this has not always been the case and has fluctuated throughout the year.
For specific models, it turns out some EVs are significantly cheaper to insure. CompareTheMarket compared the average premium on a range of models and found significant variations in costs. An electric Volkswagen, for example, was £353 cheaper to insure than its petrol equivalent. Meanwhile, an electric Jaguar was £301 more expensive than a petrol model.
Pricey repair costs
The EV industry is growing, but the fact remains there are still very few EVs on the road compared to petrol cars – and this has an effect on insurance premiums.
Recent data released by the Society of Motor Manufacturers and Traders (SMMT) indicates that although sales of battery electric vehicles (EVs) reached an all-time high of 46,626 in March, they still accounted for slightly over 16pc of the overall market share, the same proportion as last year.
Because of this, there are few garages in the UK equipped to deal with electric cars – both due to parts being less commonly available, and because specialist mechanics are sometimes required to make the repairs. This is despite the fact that the cost of actually fixing EVs is lower, according to car-selling website Cinch.
Repair prices are expected to improve as EV uptake increases, but – for now – this can push premiums higher for certain models.
EVs may be written off more easily
A Telegraph investigation revealed instances where electric vehicles were deemed total losses due to minor damage sustained by their batteries.
One senior source in the insurance industry said that even slight incidents, such as mounting a kerb, could potentially lead to EVs being sent to the scrapheap. Experts attribute this vulnerability to the battery's placement within the vehicle, increasing the likelihood of damage even in minor accidents.
"Batteries are the most expensive part of an electric car, accounting for around 50pc of its value, and there are only a few qualified technicians in the UK able to remove a battery, let alone repair it," said Chris Payne, head of engineering at motor insurer LV.
AA president Edmund King added: "On EVs, the battery can, in effect, form part of the chassis, so if there is serious structural damage, it might mean the car is written off."
Supply-side shortages mean that it can be difficult for insurers to provide an exact replacement, and may be left with no other option but to provide drivers with a temporary petrol car, or a different electric model.
Your insurance policy should pay out if your battery is accidentally damaged, stolen or damaged by a fire, but if it fails due to normal wear and tear, you’ll be on the line to replace it – and it can cost several thousands of pounds.
Due to these issues, some EV owners choose to lease their batteries. The lease agreement should include some form of insurance, so it’s a good idea to check what’s included, and let your insurance provider know.
Watch out for cables
Challenges can arise when it comes to charging EVs, since they need to be plugged into a charging point via a cable for extended periods. If you can’t do this on a private driveway, it will mean trailing a cable across a public pavement.
In such cases, the driver has a responsibility to exercise caution for the safety of the public, in case anyone trips over charging cable and injures themselves, according to insurance experts Zurich.
Some insurance policies include additional public liability insurance to cover you if someone takes legal action after tripping over a charging cable, but this will mean a pricier policy.
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