Are Electric Vehicles Cheaper to Insure?

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From all indicators, the electric car is finally coming into its own. A long-standing part of science fiction's visions of the future, the electric car has been a reality for awhile now -- and its popularity seems poised to grow considerably in the coming years. In fact, while gas cars may never entirely become extinct, predictions say the electric car may well rule the roads by 2040.

But the real question for the average driver comes down to one thing: how much will it cost? Are electric cars cheaper to buy, use, maintain, and insure?

The Rise of the Electric Vehicle

Electric vehicles aren't anything new -- they've been around much longer than many people think. The first electric vehicles appeared in the nineteenth century, and in the early 1900s, electric cars were perhaps even more popular than they are today.

When motor vehicles first came on the scene, the primary mode of transportation was still the horse. Finding new alternatives to the horse meant cars that ran on electric, steam, and petroleum, with no particular preference paid toward any particular means of powering the engine. This came to an end when Henry Ford's Model T came on the scene in 1908, which was considerably cheaper than its electric contemporaries. In short, the price tag killed the electric car for a long time.

But now there are a lot of reasons why electric vehicles are on the rise again:

  • Ecological concerns. With caring for the environment being more important to consumers than ever before, the electric car has plenty to offer. Electric cars cut carbon emissions by a lot -- your average EV produces the emissions equivalent of a car that gets 73 miles to the gallon That's a tremendous and much-needed reduction in emissions over the lifetime of a vehicle. Electric vehicles also cut oil use -- use of EVs could reduce oil use in the US by 1.5 million barrels by 2035.
  • Convenience. One of the major draws of the electric or hybrid car for many is the ability to charge at home. A typical EV can be plugged in overnight and be ready with a "full tank" every morning. This not only makes fueling costs more predictable, but can reduce maintenance costs as well -- there's no need to change spark plugs, replace timing belts, or any of the other maintenance items associated with gas-powered vehicles.

Electric vehicles have also been hailed as more comfortable and easier to drive, as they have a low center of gravity, better handling and responsiveness, and instant torque. In short, the electric car is rapidly becoming an affordable, ecologically friendly, comfortable way to drive.

Are Electric Vehicles Cheaper to Insure?

But the question remains: what about insurance?

The answer, unfortunately, isn't 100% clear.

In the past, electric vehicles have generally been more expensive to insure because of the unique parts and technology they required. These specialized parts were more difficult to repair or replace, which made it harder to calculate premiums. There was also a safety issue: not that electric cars were unsafe, but despite its long history, the electric car hadn't yet been firmly established in the mainstream.

As EVs have grown more popular, that's all started to change. Research among insurance companies has shown that people who buy electric cars tend to be more mindful of the environment, and also better about respecting road safety and traffic laws -- which means lower crash statistics -- which translates to lower insurance premiums for the consumer.

But some research says differently -- that electric cars might be as much as 20% more expensive to insure than gas-powered cars, because of their relative expense (EVs unfortunately still carry a bigger price tag than most of their gas-using counterparts). This is where hybrid vehicles occupy something of a sweet spot, as they're a little more expensive to ensure than petroleum vehicles, but less expensive than insuring an electric-only vehicle.

Repair costs can also factor into insurance premiums. Ironically, electric vehicles require less maintenance in general than gas-powered vehicles -- but when they do require maintenance or repair, the repair costs tend to be higher. The battery systems and need for specially trained mechanics can make them trickier to keep running in case of accident or mishap, which leads to possibly higher insurance premiums.

In short, the insurance industry still has some catching up to do as EVs become more popular.

List of Cars That Are Cheapest to Ensure

So how can you save the most on car insurance for your electric vehicle? As always, it pays to shop around for the best rates. But a great place to start is to compare rates for the electric cars that are cheapest to ensure: