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You may be familiar with the perks of owning an electric car. Besides reducing your carbon footprint, electric cars can save you hundreds or even thousands of dollars in gas. But there’s an added cost of owning an electric car that most drivers don’t consider before making the purchase; auto insurance for electric cars tends to cost more.
In this blog, we’ll explore a few reasons why car insurance is more expensive for electric cars and how you may be able to find cheaper insurance if you intend to purchase one. You can learn more about the factors that affect your car insurance rates HERE.
Electric Cars Are More Expensive Than Gas Cars
One of the simplest reasons insurance for electric cars is typically more expensive than for gas cars is because electric vehicles have a higher price tag. Car insurance rates tend to rise with the cost of the vehicle since the cost of repairs and replacement go up. What’s more, the battery systems that power electric cars are complex and expensive to repair.
How Much More Can You Expect to Pay for Electric Car Insurance?
The answer to this question largely depends on your location and insurance company. Car insurance for electric vehicles tends to cost around 20 percent more than insurance for the gas version of the same vehicle. For electric-only car models, there is no direct comparison to gas vehicles, but insurance still tends to be relatively high compared to gas-powered cars.
What About Hybrid Cars?
Interestingly, hybrid cars tend to have lower insurance rates than both gas and electric cars. Many of the nation’s largest insurance companies offer discounts to drivers with hybrid vehicles. In general, drivers with hybrids commute fewer miles overall than drivers with traditional cars do.
Insurance Discounts for Electric Cars
Although insurance is generally more expensive for electric cars, some insurance providers now offer discounts to electric car owners to incentivize them to switch insurers. Also, research shows that electric car drivers tend to file fewer claims than gas car drivers.
You can learn about other car insurance discounts HERE.
The Auto Insurance Marketplace Is Changing with the Times
One of the primary reasons why insurance tends to be more expensive for electric cars is because the technology is so new. Insurance providers don’t have much data to use when calculating their rates, which forces them to be cautious and charge more. In the coming years, the cost of electric cars will likely reduce as the technology evolves, which should translate into lower auto insurance premiums.
Are Electric Cars Worth It?
With the higher upfront cost and hike in car insurance rates, it’s easy to assume that buying an electric vehicle is simply not worth the expense. But if you find an insurer who offers discounts to drivers with green vehicles, you may find that the long-term savings far outweigh the upfront cost of switching from gas to electric.