Buying insurance for your EV? Know coverage and premium rates
The electric vehicle segment has been rising rapidly in India over the past few years. More people are opting for EVs—both two-wheelers and four-wheelers—as their primary mode of transportation for daily commutes within city limits. However, to legally drive the EV on our roads, vehicle insurance is mandatory. But are there any special provisions for getting insurance for an EV? Here's everything to know.
Why does this story matter?
Purchasing a vehicle is a matter of pride and joy for many people in India. It reduces their dependency on public transport, allowing better freedom of mobility. With sustainable mobility solutions becoming a priority in recent years, many automakers are developing Battery Electric Vehicles (BEVs) to cater to the rising demand. Apart from the vehicle itself, another crucial purchase is its insurance.
First, what is vehicle insurance and why it is mandatory
Insurance is a legal contract between the insurer (insurance company) and the vehicle owner. It protects the owner from any unexpected damage caused during an incident. According to the Motor Vehicles Act of 1988, a minimum of third-party insurance is mandatory for a vehicle to be road legal. This is done to provide peace of mind and financial support to owners, after an accident.
Cost of insurance for EVs in India
On average, the premium of a one-year third-party insurance policy for EVs is based on the vehicle's kilowatt (kW) capacity. Per Policybazaar, for cars/bikes under 30kW, it will set you back by Rs. 1,780. For models with a capacity between 30kW and 65kW, it costs Rs. 2,904. Meanwhile, for EVs with a capacity over 65kW, it is priced at Rs. 6,712.
Is EV insurance different than regular fuel-powered vehicle insurance?
Compared to a fuel-powered vehicle, the cost of components of an EV is much higher. Hence, insurance companies offer different premium structures for a petrol/diesel-powered car than the electric vehicle. Therefore, the overall cost of ownership of an EV is slightly higher, as of now.
What is covered under an insurance policy?
Vehicle insurance provides coverage against loss or damage caused during an accident, along with replacement/repair of damaged components. It also provides relief against theft, fire, and natural calamities such as floods, typhoons, earthquakes, and more. Apart from this, comprehensive insurance provides cover for the owner as well as third-party liabilities and also provides medical expenses up to Rs. 15 lakh for the policyholder.
Is EV insurance claim process any different?
Although the coverage differs in terms of mechanical components of a fuel-powered vehicle and EV, the claim process for both categories remains identical. The policyholder can either opt for cashless repair at any network service point or get reimbursed after repair work.
