Thursday, May 19, 2022

Electric car insurance is up to 60 per cent more expensive than petrol and diesel models

Car insurers are pushing up the price of car insurance premiums for electric vehicles, claims HonestJohn.

The consumer site is now calling for the Insurance Premium Tax (IPT) put on electric cars to be scrapped as it is causing a significant increase in costs by as much as 60 per cent when compared to petrol equivalents.

Prices are still high for EV premiums in the UK despite the three per cent year on year reduction in premium costs across the board.

Data from the Society of Motor Manufacturers and Traders (SMMT) show that there were more than 1.2 million petrol and diesel cars registered between January and June 2018, yet just 7441 electric cars left showrooms over the same six months.

Some groups believe that higher list prices, range anxiety, and insufficient charging infrastructure is turning a number of drivers off.

“If the government is serious about getting more people into genuine zero-emission electric vehicles, rather than plug-in hybrids, then there needs to be decisive action,” said Managing Editor, Dan Powell.

“And the government itself holds the key. At present, it takes 12% off every motor insurance premium in IPT.

“If it removed IPT from pure electric vehicles, then premiums would instantly drop and this would improve the incentive for buyers to swap their diesel or petrol for pure electric.”

According to analysis by the consumer site, some electric car insurance premiums are up to 60 per cent more expensive to insure than their petrol or diesel counterparts.

Young professionals are among the worst affected by these price surges with some insurers demanding more than £1,800 for 12 months’ cover.

“While on the one hand electric vehicles tend to be smaller and less powerful, they also need specialist parts and skills to repair so may cost more to insure in some cases,” said a spokesperson for the Association of British Insurers.

“But drivers can expect pressure on insurance premiums to reduce as the technology becomes more widespread”

A test quote on similar models and car manufacturers from found a female driver aged between 30 and 55 who had no motoring convictions showed that a petrol car with a comprehensive motor insurance policy was £567.

Meanwhile, it was £607 for a diesel car and £751 for an electric vehicle. Running the same quote for a male aged under 25 revealed that the average annual insurance policy would cost £1484 for a petrol car, £1592 for a diesel and a whopping £1854 for an electric vehicle.

Delve into the numbers at GoCompare for a professional in their 30s and the costs for insurance drop, but the price disparity grows.

For example, a 35-year-old accountant living in a city with five years’ no claims can expect to pay £247 when it comes to insuring a 2015 Renault Clio petrol.

A similar fully comprehensive quote for the same firm’s electric Zoe is £395 – 60 per cent higher than the Clio, despite the fact that both are similarly priced and equipped.

“Until people actually live with electric cars, there’s a perception that owning one comes with a compromise,” added Dan Powell.

“Many of these compromises have already been addressed – EVs have a good range, are quickly and easily charged and are getting cheaper to buy, but the government and insurance industries are doing the future of electromobility no favours at all, and this is something that requires immediate change.”


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