Electric Car Insurance
Insurance regulator IRDAI has come up with a mandate to incentivise electric car owners and work towards a sustainable environment.
Thinking of buying an electric car? Here's what you should know about insuring it.
In the last few years, electric cars have been creating a buzz around the world and for good reasons. With climate change looming over us, switching to electric vehicles is the best decision you can make for yourself and future generations. They reduce harmful air pollution and greenhouse emissions, and some parts of these cars are made from eco-friendly or recycled materials, reducing the burden on the planet.
As per a NITI Aayog report, India could save 64% of energy demand for road transport and 37% of carbon emissions by 2030 by pursuing a policy of shared, electric, and connected mobility.
While the momentum for upcoming electric cars in India is just taking off, it holds a promising future with the government taking some encouraging steps to further this movement. For example, the GST on a Li-ion electric car battery has been reduced from 28% to 18% to promote EVs.
Insurance regulator IRDAI has come up with a mandate to incentivise electric car owners and work towards a sustainable environment. Effective from June 16th, 2019, third-party liability insurance for private electric cars in India has been made 15% lower than that of general private cars of similar type. Certain state governments have extended tax incentives on the registration of hybrid and electric cars in India.
Many leading vehicle manufacturers have launched electric cars in India. From Mahindra to Tata to Hyundai to MG, the options are steadily growing. Additionally, there are many upcoming electric cars in India to watch out for from other top brands such as Lexus, Nissan, Porsche, Maruti, Audi, Tesla, etc. In fact, 21 new electric cars in India are expected to be launched in 2020-21.
Currently, the electric car price in India starts around Rs 7 lakh and go all the way up to Rs 24 lakh. The most economical one at the moment is the Mahindra electric car e2oPlus, which is priced at Rs 7.46 lakh.
Meanwhile, the Hyundai electric car Kona Electric is at the other end of the spectrum, at about Rs 24 lakh. When it comes to a moderate electric car price in India, you can find the Tata Electric car Tigor (about Rs 11 lakh) and Tata Nexon (around Rs 15 lakh) in the mix. However, as a leading brand in India, the Maruti electric car WagonR Electric and the Futuro-E are among the most awaited models.
As of now, there is no specialised insurance for e-vehicles, so you have to buy the same insurance as for other petrol or diesel cars. However, this is soon set to change. With the demand for upcoming electric cars in India on the rise, motor insurance providers are developing bespoke insurance options that primarily cater to these variants.
For instance, Tata AIG soon plans to launch the Auto Secure e Vehicle Comprehensive Policy, which is designed for electric cars, as it aims to cover 'own damage' as well as damage caused if the electric car battery bursts while charging. It will also cover the standard third-party liability for damage to property and death or bodily harm.
Customers will also have the option to buy motor insurance with or without battery cover. This is probably because an electric car battery makes up approximately 40-60% of the cost of the vehicle, which is a result of the high cost of the Li-ion electric car battery.
What are the features of the new e-vehicle comprehensive policy?
The Auto Secure e Vehicle Comprehensive Policy will also extend 12 add-on covers, such as depreciation reimbursement, no-claim bonus (NCB) protection, repair of glass, fibre, plastic, and rubber parts, loss of personal belongings, emergency transport and hotel expenses, daily allowance, return to invoice, key replacement, motor secure, tyre secure, consumable expenses, and roadside assistance.
Whether you already have an electric car and are looking forward to specialised insurance, or are looking to buy upcoming electric cars in India, you can rest assured that Tata AIG will have you covered.
Though the electric vehicle industry is currently hampered by challenges like the high electric car price in India and lack of infrastructure such as charging stations, the scenario is rapidly changing with ecosystems being created to improve sustainability. So, when the time comes to buy a new car, #ThinkAhead and opt for an electric car over a traditional one.