Electric cars are becoming increasingly popular, but they are not yet mainstream. It’s normal for first-time buyers to have questions about this, including the right insurance.
Below we take a closer look at which insurance companies require EVs, where to find them and how you can save money in the process.
What insurance do electric vehicles need?
Insuring an electric vehicle is equivalent to insuring a conventional, gas-powered vehicle. All drivers must carry at least the legally required minimum liability insurance. This pays other people’s medical bills or damage to property if the policyholder causes an accident.
If the driver has a rental agreement or loan for their vehicle, their lender will most likely require collision and collision insurance as well. Collision insurance pays for repairs to the driver’s vehicle if they cause an accident or are involved in a single-car accident. Comprehensive insurance pays for damage caused by weather, animal-vehicle collision, theft and vandalism. Drivers can also add optional protections to their vehicles as they see fit.
Drivers can get auto insurance for their electric vehicle from any auto insurance company. The process is the same as insuring a conventional vehicle. The driver shares information about their vehicle and driving records, obtains a quote, adjusts their policy limits and coverage options, and purchases the policy. If they then have to make a claim, the insurance company will pay the damage once the driver has met their excess.
Discover: Save money with one of these top car insurance companies
More: Check out our picks for the best car insurance companies
The biggest difference between traditional car insurance and electric car insurance is the cost. Electric vehicles tend to be more expensive to buy and more expensive to repair. Because insurers may have to pay more in the event of a claim, they charge higher premiums to electric vehicle owners.
How to save on electric car insurance
Shopping remains the best way to make big on auto insurance, regardless of whether the vehicle is gas-powered or electric. Compare offers from multiple providers to see which one offers the best combination of high coverage, low rates, and great customer service.
While uncommon, there are a few companies like Liberty Mutual and Travelers that offer discounts to electric or hybrid vehicle drivers. This could lower a driver’s rate significantly, but the only way to know for sure is to get quotes from insurers.
EV owners willing to put their safe driving skills to the test could also try pay-as-you-go auto insurance. This monitors driving behavior via a mobile app or a small device installed in the vehicle. Many companies that offer this give drivers an upfront discount for participating, and they can get additional discounts if they drive safely and infrequently.
And if all this is not enough for you, you can also reduce your premium by increasing your deductible. These are the expenses that the policyholder pays when making a claim. Those worried about not having enough cash on hand should put the extra money they save in premiums each month into their emergency fund until they save enough to cover their deductible.
Finding the right EV insurance cover can take time, but in the event of an accident, it’s worth it. And if the rate just doesn’t fit a driver’s budget, they can look back in a year or two to see if they can find a lower premium then.
Our best car insurance for 2022
Ready to buy car insurance? Whether your focus is price, claims processing, or customer service, we’ve researched insurers across the country to bring you our top picks for car insurance coverage. Read our free expert review today to start.
We firmly believe in the Golden Rule, which is why editorial opinions are solely ours and have not been previously reviewed, approved, or endorsed by included advertisers. Ascension does not cover all offers in the market. The Ascent’s editorial content is separate from The Motley Fool’s editorial content and is produced by a different team of analysts. Kailey Hagen has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.