Do You Drive an Electric Vehicle? Make Sure You Have the Right Insurance

Electric vehicles (EVs) are surging in popularity – and this year, they’ll likely continue their upward trend. But if you drive an EV, your vehicle comes with added risks that insurers take into account. You need to understand your vehicle’s risk before hitting the road.

Here, we’ll discuss three common EV risks and how to manage them.

Risk 1: Lithium-ion Batteries Can Be a Fire Hazard

Instead of relying on gas for fuel, EVs use lithium-ion (Li-ion) batteries. Their high power-to-weight ratio enables them to hold lots of energy without taking up much bulk – and they can retain a full charge longer than other alternatives.

Despite their benefits, however, Li-ion batteries create fire risks that may be unfamiliar to new EV drivers. EV battery fires are mainly caused by…

• Short circuiting: Caused by high voltage or severe battery damage.
• Thermal runaway: Caused by overheating or overcharging.

When it comes to collisions, Li-ion batteries come with risks gas-powered cars don’t have. If your battery is damaged in a crash, your EV may catch fire on impact. Even if your EV doesn’t catch fire, the mere possibility of battery damage makes it more likely that your vehicle is declared totaled.

Compared with fires in gas-powered vehicles, EV fires are overall uncommon. But when they happen, they can be extremely difficult to manage. Li-ion battery fires are fueled by liquid electrolytes within the battery itself. This liquid makes the battery catch fire faster – and the flames require more water to put out.

Once first responders extinguish a Li-ion battery fire, the battery may still have stored energy that can cause it to spark and reignite. The uncertainty of additional fires can put first responders, bystanders, and mechanics at risk.

If you’re looking for EV auto insurance, it’s important to know that auto insurance carriers will consider your vehicle’s fire risk in their policy pricing. To manage your EV’s fire risk…

• Avoid driving long distances on hot days – this can overtax your battery.
• Limit “fast charging,” which can compromise your battery health.
• Prevent overcharging by only charging your battery when needed.

Risk 2: For Pedestrians, Some EVs Are Dangerously Quiet

EVs are built with fewer parts to maximize their mileage. Their light construction makes them quieter than gas-powered vehicles – and quiet driving can make pedestrian accidents more likely.

When people cross the street, looking both ways doesn’t always cut it. They need audio cues to avoid being hit by vehicles. That’s especially true for people with impaired vision. But if your EV drives quietly, it may not be providing loud enough audio cues for pedestrians. If they can’t hear you, they can’t get out of your way.

Research reflects these risks: EVs are 20 percent more likely than gas-powered cars to hit pedestrians. That makes your vehicle particularly risky to drive in pedestrian-heavy areas.

To minimize the risk of pedestrian-vehicle collisions…

• Install a noise emitter on your EV if it doesn’t have one.
• Drive slower and limit distractions in pedestrian-heavy areas.
• Avoid charging your vehicle near sidewalks to reduce pedestrian contact.

The good news: federal regulations will soon require noise emitters on all new EVs. These emitters can help standardize acoustic signals to pedestrians throughout the country. However, drivers aren’t required to retrofit older EV models.

Insurance actuaries will use this risk information to determine your EV’s auto insurance premium.

Risk 3: EVs Are Expensive to Repair

When insurance professionals price your premiums, they take into account the cost of vehicle repairs. The unique construction of EVs makes repairs particularly expensive.

EVs have fewer parts than gas-powered cars, so each part matters more if your vehicle is damaged. EV batteries also rely on two rare metals: cobalt and lithium. The current lithium shortage makes the metal even harder to find than before – and makes your battery more expensive to repair if damaged.  

Another cost factor to consider: not all mechanics can repair EVs. the ones that do often charge more for their specialized labor. Expensive servicing will drive up the total cost of repairs.

Unlike other risks we’ve discussed, you can’t really control EV repair costs. However, you can manage risk by following these best practices for EV maintenance.

Widen Your Carrier Options to Find the Best EV Coverage

Like many vehicles, EVs need auto insurance before hitting the road. But EVs have added risks that may affect the cost of coverage – one reason you’ll want to compare multiple carriers before selecting a policy.

Luckily, WE offer the choice you need to find affordable auto coverage to meet your specific needs. Interested in speaking with a licensed professional? Talk to an agent today.