Do Electric Cars Cost More to Insure?

In general,

electric cars

are more expensive to insure than conventional vehicles. This is due to their higher purchase and repair costs, which insurance providers take into account when calculating premiums. However, the savings on gas and tax incentives may be enough to offset the additional cost of your policy. On average, electric vehicles have significantly higher insurance costs than cars that run on gas, with MoneyGeek finding that they tend to cost 15% more than a comparable combustion model.The higher price of an electric car and its more complex equipment mean that its repair or replacement may cost more if an accident occurs.

This can lead to higher rates for policyholders who have comprehensive and collision coverage. However, tax incentives and long-term savings on fuel and maintenance can help offset higher insurance rates.Electric vehicles do not fit perfectly into the historical framework formed by the older automotive categories. Insurance for electric vehicles is not based on the same principle as traditional cars, explains Miranda Yan, co-founder of VinPit, an automotive data company that helps users search for vehicle information or history.A recent study conducted by NerdWallet found that electric cars cost on average approximately 21% more to insure than vehicles that run on gasoline. This means that the car cannot simply be taken to the insurer's preferred body shop if it is outside their scope of knowledge.

You can help offset the cost of insuring your electric car by taking advantage of local, state and federal discounts.Plus, you'll save money by not having to pay for gas or the type of maintenance a regular car needs, such as oil changes. As electric vehicle production increases and the availability of qualified parts and repair shops increases, the cost of repairing them should decrease, as should electric car insurance rates.First, research any local or federal tax credits you may be entitled to for driving an electric vehicle. Assuming you still want to buy an electric car, expect rates to be fairly consistent from one insurer to another, regardless of the way it's powered. Also note that amid announcements from many manufacturers about their upcoming plans to increase electric vehicle production, a number of new electric models are due to appear in the U.S.It's important to understand what having an electric car can mean for your insurance rates.

As you can see, the additional costs can be minimal, and you can find a good policy at a fair price with the best car insurance companies.