EV Insurance Costs UK

As an FCA-authorised motor insurance expert that has arranged over 800,000 policies, WeCovr provides this definitive guide to EV insurance costs in the UK. We explore the factors driving up premiums and offer practical strategies for drivers and fleet managers to secure affordable, comprehensive cover for their electric vehicles.

Why Electric Car Insurance is Rising in the UK & How Drivers Can Save Money

The electric vehicle revolution is well and truly underway in the UK. With the 2035 ban on new petrol and diesel car sales looming, millions of drivers are making the switch, drawn in by lower running costs, environmental benefits, and a superior driving experience. Yet, many new EV owners are receiving a nasty shock when their insurance renewal arrives.

While you might be saving a fortune on fuel, you could be paying significantly more for your motor policy. According to the Association of British Insurers (ABI), the average premium paid for private motor insurance in the first quarter of 2024 was £635, a record high. For electric vehicles, this figure is often even higher.

But why is this happening? And more importantly, what can you do about it? This guide breaks down the complex factors behind rising EV insurance costs and provides a clear, actionable roadmap to help you find the best value motor insurance in the UK.

The Core Reasons EV Insurance Premiums are Increasing

Insurers calculate premiums based on risk. The higher the statistical likelihood of a claim and the greater the potential cost of that claim, the more you will pay. For electric vehicles, a combination of new technology, high values, and a developing repair infrastructure has created a perfect storm for rising costs.

Higher Purchase Price and Repair Costs

The single biggest factor influencing an EV's insurance premium is its value and the cost to repair it.

• High 'On-the-Road' Price: Electric cars are, on average, more expensive to buy than their internal combustion engine (ICE) counterparts. A higher vehicle value means a larger potential payout for the insurer in the event of a total loss (a write-off), directly increasing the premium.
• Complex Technology: EVs are packed with sophisticated technology, including advanced driver-assistance systems (ADAS) like cameras, lidar, and radar sensors. Even a minor bump that would scratch a bumper on an older car can damage these sensitive components, leading to complex and costly recalibration or replacement.
• Specialist Materials: To save weight and maximise range, many EVs use lightweight materials like aluminium and carbon fibre composites in their construction. These materials require specialist equipment and techniques to repair, unlike the steel panels on most conventional cars.

Here is a simple comparison of a hypothetical minor front-end collision:

As this illustrates, the cost to repair an EV can be more than double that of a petrol equivalent for the same minor incident, a risk that is priced directly into your premium.

The Battery Problem: Replacement and Fire Risk

The lithium-ion battery pack is the single most expensive component in an EV, often accounting for 30-50% of the vehicle's total value. This creates a unique set of challenges for insurers.

• Prohibitive Replacement Costs: A replacement battery pack can cost anywhere from £5,000 to over £20,000. If the battery casing is damaged in a collision, even if the cells inside are fine, many manufacturers mandate a full replacement.
• The Write-Off Threshold: This high cost means that EVs have a much lower threshold for being declared a 'write-off'. An accident that would be economically viable to repair on a petrol car can easily result in a total loss for an EV if the battery is compromised. ABI data has highlighted that EVs are more expensive to repair than their petrol equivalents, and they take longer to fix.
• Fire Risk and Specialist Handling: While EV fires are statistically rarer than petrol car fires, they are much more difficult to extinguish when they do occur. They require specialist training and equipment, and a damaged battery must be stored in a quarantined area due to the risk of thermal runaway. This adds significant cost and complexity to the claims process for recovery and storage firms, which is passed on to the insurer.

Scarcity of Approved Repairers and Technicians

The number of EVs on UK roads has grown far faster than the infrastructure to support them. According to the Institute of the Motor Industry (IMI), as of 2024, only a fraction of mechanics in the UK are qualified to work safely on the high-voltage systems of electric vehicles.

This skills gap creates a major bottleneck:

1. Longer Waiting Lists: Fewer qualified technicians mean longer waits to get a vehicle assessed and repaired.
2. Higher Labour Costs: Specialist skills command higher wages, increasing the labour cost component of any repair bill.
3. Increased Vehicle Movement Costs: Your car may need to be transported further to reach an approved repair centre, adding to the insurer's costs.

Longer Repair Times and Courtesy Car Costs

The combination of parts delays and technician shortages means EV repairs take, on average, longer than for ICE vehicles. The ABI notes that repair times can be significantly longer.

This has a direct knock-on effect on another part of your claim: the courtesy car. If your comprehensive policy includes a courtesy vehicle, the insurer is paying for it for every extra day your car is off the road. With a shortage of like-for-like EV courtesy cars, insurers sometimes have to hire them from third-party firms at a premium, further inflating claim costs.

The Impact of Performance and Driver Behaviour

One of the joys of driving an EV is the instant torque and rapid acceleration. However, from an insurer's perspective, this presents a higher risk, especially for drivers unaccustomed to it. The powerful, silent acceleration can catch people out, potentially leading to a higher frequency of low-speed accidents. Insurers are still gathering data on this, but the perceived risk of this performance capability is factored into the premium.

Understanding Your Motor Insurance Policy

Before you can save money, it's crucial to understand what you're buying. In the UK, motor insurance is a legal necessity, governed by the Road Traffic Act 1988.

The Legal Requirement for Motor Insurance in the UK

It is illegal to drive or keep a vehicle on a public road in the UK without at least 'Third Party' insurance cover. The only exception is if your vehicle has been declared 'off the road' with a Statutory Off-Road Notification (SORN) from the DVLA. Driving without insurance carries severe penalties, including a fixed penalty of £300, six penalty points on your licence, and potentially an unlimited fine and disqualification from driving.

Types of Car Insurance Cover Explained

There are three main levels of cover available. It's a common misconception that Third Party is always the cheapest; often, Comprehensive offers better value.

For businesses, Fleet Insurance provides a single policy to cover multiple company vehicles, simplifying administration and often reducing costs. This cover must meet the same legal minimums and is essential for any business operating two or more vehicles. WeCovr is an expert broker in arranging competitive fleet insurance for cars, vans, and mixed-use vehicles.

Key Insurance Terms You Need to Know

• No-Claims Bonus (NCB) or No-Claims Discount (NCD): This is a discount you earn for each consecutive year you go without making a claim on your policy. It's one of the most significant factors in reducing your premium, with five or more years of NCB often resulting in discounts of 60-75%.
• Policy Excess: This is the amount of money you agree to pay towards any claim you make. It's split into two parts:
  • Compulsory Excess: A fixed amount set by the insurer.
  • Voluntary Excess: An additional amount you choose to pay. A higher voluntary excess shows the insurer you are willing to take on more of the risk, which can lower your premium. However, you must ensure you can afford to pay the total excess (compulsory + voluntary) if you need to claim.
• Optional Extras: These are add-ons you can buy to enhance your policy. Common extras include:
  • Motor Legal Protection: Covers legal costs if you need to pursue uninsured losses (like your excess or loss of earnings) from a third party after a non-fault accident.
  • Breakdown Cover: Provides roadside assistance if your vehicle breaks down.
  • Guaranteed Courtesy Car: Ensures you get a replacement vehicle while yours is being repaired, which can be an upgrade on the standard courtesy car provision.

How to Get Cheaper EV Insurance: Practical Tips for UK Drivers

Despite the rising costs, there are many effective ways to reduce your EV insurance premium. You don't have to accept the first quote you're given.

1. Compare, Compare, Compare with an Expert Broker

The single most effective way to save money is to shop around. However, simply using a price comparison website isn't always enough. Many specialist insurers who offer competitive EV policies do not appear on these sites.

This is where an independent, FCA-authorised broker like WeCovr becomes invaluable. We have access to a wide panel of both standard and specialist insurers. Our experts understand the nuances of the EV market and can negotiate on your behalf to find cover that is both comprehensive and competitively priced, at no extra cost to you.

2. Choose Your Electric Vehicle Wisely

Not all EVs are created equal in the eyes of an insurer. Every car in the UK is assigned an insurance group from 1 (cheapest) to 50 (most expensive). This is based on factors like the car's price, performance, security, and repair costs.

Before you buy an EV, check its insurance group. Choosing a model in a lower group can save you hundreds of pounds a year.

Models with better parts availability and a more established repair network in the UK often attract lower premiums.

3. Optimise Your Policy Details

How you set up your policy can make a huge difference.

• Increase Your Voluntary Excess: If you are a safe driver and can afford a higher one-off cost, increasing your voluntary excess from £150 to £400, for example, can significantly reduce your annual premium.
• Pay Annually: Paying for your insurance in monthly instalments involves a credit agreement and includes interest charges. Paying the full amount upfront will always be cheaper.
• Be Accurate with Your Mileage: Don't overestimate your annual mileage. If you previously commuted 12,000 miles a year but now work from home and only do 5,000, make sure your policy reflects this. Lower mileage equals lower risk.
• Add a Low-Risk Named Driver: Adding an experienced driver with a clean record (like a spouse or parent) to your policy can sometimes reduce the premium, as it implies the car will be used less by the main, higher-risk driver.
• Review Your Optional Extras: Do you really need that top-tier courtesy car cover if you have a second vehicle? Does your bank account already provide breakdown cover? Trim any extras you don't need to cut costs.

4. Enhance Your Vehicle's Security

Insurers love security. The harder your car is to steal, the lower your premium will be.

• Safe Parking: If you have a garage, use it. A car parked in a locked garage overnight is a much lower risk than one left on the street. A private driveway is the next best thing.
• Thatcham-Approved Security: Fitting an approved alarm, immobiliser, or vehicle tracker can earn you a discount. Trackers are particularly effective for high-value EVs.

5. Consider a Telematics (Black Box) Policy

Telematics insurance uses a small device or a smartphone app to monitor your driving habits—such as speed, acceleration, braking, and cornering. It's an excellent way for young drivers, or those new to the instant power of EVs, to prove they are safe behind the wheel and earn a lower premium based on their actual behaviour, not just statistics.

6. Build and Protect Your No-Claims Bonus (NCB)

A long NCB is your reward for safe driving. After five years, it can slash your premium by over 60%. It's worth considering paying a small additional fee to protect your NCB. This allows you to make one or sometimes two fault claims within a set period without your years of discount being wiped out.

The Future of EV Insurance in the UK

The insurance market is adapting. The ABI is actively working with vehicle manufacturers and repairers to address the current challenges. We can expect to see several positive developments over the next few years:

• Growth of the Repair Network: The number of IMI-qualified EV technicians is growing, which will eventually ease the bottleneck, reduce repair times, and lower labour costs.
• Improved Battery Technology and Repairability: Manufacturers are beginning to design batteries with repair in mind, allowing for the replacement of individual modules rather than the entire pack. This will drastically reduce the number of unnecessary write-offs.
• Better Data, Better Pricing: As insurers gather more real-world data on EV accidents and repairs, they will be able to price risk more accurately, rewarding safer models and drivers with fairer premiums.

Why Choose WeCovr for Your EV Motor Insurance?

Navigating the complexities of the motor insurance market can be daunting, especially with the unique challenges of electric vehicles. WeCovr is here to make it simple.

As a leading, FCA-authorised insurance broker, we are dedicated to finding the best possible cover for our clients. We work with a huge range of providers, from major household names to specialist underwriters who understand the EV market inside and out. Our high customer satisfaction ratings are built on providing clear, impartial advice.

Whether you need cover for your personal electric car, a commercial van, or an entire business fleet, our expert team can help. Better yet, when you take out a motor or life insurance policy with us, you may be eligible for discounts on other types of cover you need.

Frequently Asked Questions (FAQ)

Q1: Is it always more expensive to insure an electric car than a petrol car?

Not always, but on average, yes. While EVs have cheaper running costs, their higher purchase price, specialist repair needs, and expensive battery technology often lead to higher insurance premiums. However, for some equivalent models, the difference can be small. The best way to find out is to compare quotes for specific vehicles using an expert broker like WeCovr.

Q2: Does my standard home insurance cover my EV charging point?

Most UK home insurance policies will cover your wall-box charger for risks like fire, theft, and flood damage, as it is considered a permanent fixture of your home. However, it's essential to check your policy wording and inform your insurer when you have one installed. Accidental damage to the charger or the cable is not always included as standard.

Q3: What happens if my EV's battery is damaged in an accident?

If your EV's battery pack is damaged, your insurer's engineer will assess whether it can be safely repaired or if it needs to be replaced. Due to the high cost of replacement batteries (often £10,000+), even moderate damage to the battery can result in the vehicle being declared a 'Category S' or 'Category N' write-off, as the repair cost may exceed the car's value.

Q4: Can I add my EV charger and charging cable to my motor insurance policy?

Yes, many specialist EV motor insurance policies now offer cover for your wall-box charger and charging cables against accidental damage, fire, and theft as an optional extra. This can provide more comprehensive protection than standard home insurance, especially for damage that occurs while the cable is in use away from home.

Ready to see how much you could save on your electric vehicle insurance? Don't let rising costs take the shine off your EV ownership experience.

Contact WeCovr today for a free, no-obligation quote and let our experts find the best motor insurance UK policy for you.