UK EV Insurance Costs Soar

As an FCA-authorised motor insurance expert that has helped arrange over 800,000 policies, WeCovr understands the UK market inside and out. We see the trends before they hit the headlines, and right now, the biggest story is the dramatic rise in electric vehicle (EV) insurance costs. This guide explains why and how to fight back.

Why Your Electric Vehicle Insurance Premiums Are Rising in 2024–2025 and 7 Essential Ways UK Drivers Can Slash Their Policy Costs

Driving an electric car in the UK has never been more popular. With the 2035 ban on new petrol and diesel sales looming, drivers are making the switch in record numbers. Yet, many are discovering an unwelcome surprise: eye-watering insurance premiums.

According to the Association of British Insurers (ABI), the average motor insurance premium saw a sharp rise in 2023, and data heading into 2025 shows that EV drivers are often feeling the pinch most acutely. But why is cover for a quiet, green car costing so much more than its fossil-fuelled equivalent? And more importantly, what can you do about it?

Let's break down the factors driving up your costs and explore the essential strategies to secure cheaper, better motor insurance UK-wide.

The Core Reasons Behind Soaring EV Insurance Premiums

The price you pay for your motor policy is a direct reflection of the risk an insurer believes you represent. With EVs, insurers are grappling with a unique and expensive set of new risks.

1. The Shocking Cost of Repairs

While EVs have fewer moving parts than internal combustion engine (ICE) vehicles, the parts they do have are incredibly sophisticated and expensive.

• Specialist Components: EVs are packed with advanced technology. This isn't just the electric motor and battery; it includes intricate battery management systems, inverters, on-board chargers, and a vast array of sensors, cameras, and radars for Advanced Driver-Assistance Systems (ADAS). A damaged radar sensor used for cruise control could cost over £1,000 to replace and recalibrate.
• Battery Pack Prices: The lithium-ion battery is the single most expensive part of an EV. A replacement battery pack for a family EV can cost anywhere from £5,000 to over £20,000, depending on the make and model. Even minor-looking damage to the undercarriage can compromise the structural integrity of the battery casing, leading to a colossal repair bill that insurers must budget for.
• Lack of Aftermarket Parts: The market for second-hand or non-original manufacturer (OEM) parts for EVs is still in its infancy. For petrol and diesel cars, a vast supply chain of certified, cheaper aftermarket parts exists. For EVs, repairs often require brand-new, expensive parts sourced directly from the manufacturer, pushing claim costs up significantly.

2. The High Risk of a Vehicle 'Write-Off'

Insurers "write off" a vehicle when the cost of repair is more than its current market value (typically 50-60% of the value). For EVs, the threshold for a write-off is alarmingly low.

Research by the automotive risk intelligence firm Thatcham Research highlights that even low-speed collisions can lead to the entire battery pack being condemned by the manufacturer. If an insurer cannot get a clear, safe, and guaranteed diagnosis on the battery's health or if the manufacturer's strict guidelines demand a full replacement for even minor damage to the casing, the car is often written off.

This means a £40,000 EV involved in a seemingly minor incident could be scrapped, leading to a huge payout for the insurer—a risk they factor directly into your premium.

3. A Critical Shortage of Skilled Technicians

You can't take a high-voltage EV to just any local garage. Repairing these vehicles requires technicians with specialist training (such as IMI TechSafe qualifications) to handle the dangers of high-voltage systems safely.

The Institute of the Motor Industry (IMI) has repeatedly warned of a skills gap. As of late 2023, it was estimated that the UK would need over 27,000 EV-qualified technicians by 2025 to meet demand, but the country was not on track to meet this target.

This shortage creates two major problems for insurers and, by extension, for policyholders:

• Higher Labour Costs: Garages that have invested heavily in the training and specialised equipment required for EV repair can, and do, charge a premium for their services.
• Longer Repair Times: With fewer qualified repair shops, there are often long waiting lists for assessments and repairs, which brings us to the next point.

4. Lengthy Repairs and Courtesy Car Costs

When an EV is off the road for repairs, it's often for much longer than a conventional car. Delays in sourcing specialist parts from overseas, combined with the bottleneck caused by the shortage of technicians, can turn a two-week repair into a two-month saga.

During this time, your insurer is often contractually obliged to provide you with a courtesy car under a comprehensive policy. If your policy guarantees a like-for-like replacement, the cost of hiring another EV for weeks on end adds a significant expense to the claim. This indirect cost is ultimately passed on to all policyholders through higher premiums for everyone.

5. The Acceleration Factor

One of the great joys of driving an EV is the instant torque and silent, rapid acceleration. It can make a standard family car feel like a performance vehicle. However, insurers see this as a risk. For drivers unaccustomed to this level of immediate power, it can increase the likelihood of accidents, particularly in urban environments or when pulling out of junctions. This perceived risk, especially for drivers new to EVs or for younger drivers in high-performance models, is priced into the policy.

Understanding Your UK Motor Insurance Policy: The Unmissable Basics

Before diving into cost-cutting, it’s vital to understand the legal framework and policy types in the UK. Getting this right is the foundation of any good motor insurance strategy.

It's a Legal Requirement

Under the Road Traffic Act 1988, it is a criminal offence to drive or keep a vehicle on a public road without at least third-party insurance. The consequences of being caught without valid vehicle cover are severe and not worth the risk.

• A fixed penalty of £300 and 6 penalty points on your driving licence.
• If the case goes to court, you could face an unlimited fine and be disqualified from driving.
• The police also have the power to seize, and in some cases, destroy an uninsured vehicle at the roadside.

The Three Levels of Cover Explained

Choosing the right level of cover is crucial. While it's tempting to go for the cheapest option, this often provides a false economy.

Business and Fleet Insurance Obligations

If you use your vehicle for anything more than social, domestic, pleasure, and commuting to a single place of work, you need business car insurance. Using a personal policy for business use will invalidate it, leaving you uninsured in the event of a claim.

• Class 1 Business Use: Covers use for business by the policyholder and/or their spouse, such as travelling between different offices or visiting clients.
• Class 2 Business Use: Includes all of Class 1, plus cover for a named driver (such as a colleague) on the same policy.
• Class 3 Business Use: This is for "commercial travellers" who spend a significant amount of their working life on the road, covering long distances and carrying samples (but not usually for delivery).

For businesses with two or more vehicles, fleet insurance is the most efficient and cost-effective solution. A single policy covers all company vehicles—be they cars, vans, motorcycles or even specialist machinery. This includes mixed fleets of EVs and ICE vehicles. Expert brokers like WeCovr specialise in creating bespoke fleet insurance policies that simplify administration and reduce overall costs for your business.

7 Essential Ways UK Drivers Can Slash Their EV Insurance Costs

Now for the practical advice. While the market is challenging, you are not powerless. By being a savvy consumer, you can make a significant dent in your premium.

1. Shop Around and Compare with an Expert Broker

This is the golden rule of insurance buying. Never simply accept your renewal quote from your current insurer. Loyalty is rarely rewarded in the insurance industry; the best prices are almost always reserved for new customers.

The market is flooded with providers, and comparing them all yourself is time-consuming and confusing. This is where an independent, FCA-authorised broker like WeCovr is invaluable. We use our expertise and industry relationships to scan the market—including specialist insurers that many online comparison sites miss—to find the motor policy that offers the best level of cover at the most competitive price. This service costs you nothing and saves you both time and money, ensuring you get the best car insurance provider for your needs.

2. Be Smart with Your Policy Excess

Your policy excess is the amount you agree to pay towards any claim before the insurer covers the rest. It's made up of two parts:

• Compulsory Excess: This is set by the insurer and is non-negotiable. It's often higher for high-performance or high-value vehicles, and for less experienced drivers.
• Voluntary Excess: This is an amount you choose to add on top of the compulsory excess.

By increasing your voluntary excess (e.g., from £100 to £400), you signal to the insurer that you are sharing more of the risk and are less likely to make small, frivolous claims. In return, they will usually offer a lower premium.

Top Tip: Only set a voluntary excess that you could comfortably afford to pay tomorrow without causing financial hardship. Setting it too high could leave you unable to afford a necessary repair, making your insurance useless when you need it most.

3. Pay Annually Instead of Monthly

When you choose to pay for your motor policy in monthly instalments, you are not simply splitting the cost. You are effectively taking out a high-interest loan from the insurer or a third-party finance company. The interest (APR) charged for this credit facility can be high, often adding 10-20% or more to the total cost of your policy. If you can afford to pay for the year upfront, you will always save a significant amount of money.

Example Calculation:

• Quoted Annual Premium: £1,200
• Monthly Payment Option: £115 per month
• Total Annual Cost if Paid Monthly: £1,380 (£115 x 12)
• Saving by Paying Annually: £180

4. Secure Your Vehicle, Secure a Discount

Insurers base your premium on risk, and a major risk is theft. While most modern EVs come with excellent factory-fitted security (like immobilisers and alarms), you can go further to prove your vehicle is safe.

• Parking: Where you park your car overnight has a big impact. Stating on your policy that you park in a locked garage or on a private driveway is seen as much lower risk than parking on the street and will result in a lower premium.
• Trackers: Installing a Thatcham-approved GPS tracking device can deter thieves and significantly increases the chance of recovery if your car is stolen. Inform your insurer that you have one fitted, as many offer substantial discounts for them.

5. Be Realistic About Your Annual Mileage

Your premium is directly linked to how much you use your car. The more miles you drive, the higher the statistical chance of you having an accident. Many people overestimate their annual mileage when getting a quote. Take a moment to calculate it properly. Check your last two MOT certificates, which record your mileage each year, to get an accurate figure. Reducing your stated mileage from a generic 12,000 to a more accurate 8,000, for example, could lead to a noticeable saving. But be honest—if you have an accident and have significantly exceeded your stated mileage, an insurer could reduce a claim payout or even void your cover entirely.

6. Consider a Telematics 'Black Box' Policy

Telematics insurance isn't just for young drivers anymore. It's a perfect tool for demonstrating that you are a safe and responsible EV driver. A small device (the "black box") or a smartphone app monitors your driving style—including your speed, acceleration, braking, and cornering habits.

Consistently good driving is rewarded with lower renewal premiums. It's an excellent way to prove to an insurer that, despite the rapid acceleration capabilities of your EV, you are a careful driver. This provides them with personalised data about you, rather than lumping you in with a generic risk profile for your age and vehicle.

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

Your No-Claims Bonus (also called a No-Claims Discount or NCD) is one of your most valuable assets in the insurance world. For every consecutive year you go without making a claim on your policy, you earn a discount, which can rise to 70% or even more after five to nine years. This is the single biggest discount you can get.

Once you have built up several years of NCB, it is wise to consider paying a small extra fee to "protect" it. This optional extra allows you to make one or sometimes two claims within a set period (e.g., 3-5 years) without your hard-earned discount being affected. Given the high cost of EV repairs and the increased risk of a write-off, this protection can be a financial lifesaver after an accident.

Special Insurance Considerations for EV Owners

When comparing policies, look beyond the headline price. The best car insurance provider for an EV will offer features tailored to your vehicle's specific needs.

• Battery Cover: Check the policy wording carefully. Is the battery covered for all forms of accidental damage, fire, and theft as standard? Some policies may have exclusions, especially if the battery is leased separately from the car.
• Charging Cable and Wall Box Cover: Are your charging cables and home charging unit (wall box) covered against accidental damage, vandalism, or theft? These items can cost hundreds of pounds to replace, so this is an increasingly common and valuable policy feature.
• Guaranteed EV Courtesy Car: Does the policy guarantee you an electric replacement vehicle if yours is off the road? Being given a small petrol car for weeks can be frustrating and inconvenient if you're used to an EV and rely on home charging.
• Running Out of Charge Cover: Many EV-specific policies now include breakdown assistance that will tow you to the nearest functioning charge point if you run out of battery. This is often called "out of charge" cover and provides excellent peace of mind.

How Different Factors Can Affect Your EV Premium

To illustrate how these factors come together, here are some fictional but realistic profiles for EV drivers in the UK.

Note: These figures are for illustrative purposes only. Your premium will depend on your unique circumstances, location, and driving history. The best way to get an accurate price is to get a personalised quote.

At WeCovr, we pride ourselves on exceptional customer satisfaction ratings and finding the right policy for every client, from individual drivers to large commercial fleets. What's more, when you take out a motor or life insurance policy with us, you may be eligible for discounts on other types of cover, such as home or business liability insurance, providing even greater value.

The landscape for EV insurance is challenging, but armed with the right knowledge and strategy, you can find a great deal. The single most effective step is to compare the market thoroughly and not just on price, but on the quality of the cover.

Let WeCovr do the hard work for you. Get a fast, free, and no-obligation quote today and see how much you could save on your private, business, or fleet motor insurance.