With the changing trends, the Indian automotive industry is witnessing quite a boom. We are now diving into the era of electric vehicles. But whenever we talk about EVs one question remains in everybody’s mind why electric vehicles are expensive?
You must have seen the price of electric vehicles be it from TATA or any other major car manufacturer is quite high than petrol or other fuel cars. In this article in the Crox Times, we are going to discuss factors that make it more expensive and other relevant information as well.
Especially for Indian buyers, EV poses generally have two questions:
- Why electric cars are expensive?
- Why electric car insurance rates are generally higher?
- why electric cars are better
Let’s understand Why Electric vehicles are expensive?
What Makes Electric Vehicles Expensive?
To know the reason what makes it so expensive than other traditional vehicles, let’s understand how they actually work. All the EVs are generally made of three crucial elements electric motor, transmission, and battery back. The battery pack is the most expensive because of its three components. These batteries leverage Lithium-ion technology (Comparing rare earth materials), which enhances the cost of manufacturing. For larger vehicles such as SUVs, this is even costlier. So basically, the battery is the main reason why electric cars are expensive.
Now you are well familiar with the working of EV cars, let’s explore the insurance part of the vehicle as well
Check Now- How EV Cars Work in India
Is Car Insurance for Electric Cars Expensive?
EVs offer multiple benefits of being cheaper to maintain and also helping in sustainable development for a better environment counterpart with fuel-run vehicles. However, if you have taken the general research on the insurance part of electric vehicles then you would come to know that the insurance of EVs is quite expensive than other conventional cars, they have higher maintenance and their cost of repairing is also high as well.
However, don’t get way to stressed about the insurance cost of EVs Since the carmakers are now currently working to reduce the overall cost. As the cost of ownership and maintenance of EVs decreases, this would automatically decrease the price of insurance coverage as well. This is a possibility in near future, EV owners are still advised to buy the insurance at an early stage, don’t think about the miscellaneous costs. Complete insurance will not cover the motor insurance third-party liability but this would cover the own damage as well.
Factors Affecting the higher premium on Electric Vehicles
Here are some prominent factors that determine the high cost of the premium on EVs
High Cost of Electric Vehicles- One of the major reasons why the insurance premium is higher and the reason why Electric cars are too expensive for the middle class is their overall cost. The pricing lately depends on the model of the car as well. EVs are generally designed for a smooth driving experience that increases the cost of manufacturing. Through association, this leads to a higher premium that needs to be paid by the owners.
Expensive Repair costs: There is doubt in saying that we are ready for the electric era but still people feel reluctant to use and they believe that insurance it’s expensive as well. Another major reason for that is the repairing cost of electric vehicles is way too expensive, since it is modern technology, the spare parts are rare and expensive for a middle-class category to afford.
Limited Mechanic Expertise: As EVs are relatively new in the market, their repairing cost is quite higher than the conventional vehicles and mechanical expertise is very much limited in this category of vehicles. This also enhances the overall insurance cost of EVs.
Motor Insurance Cost for EVs- To encourage the purchase of EVs, the insurance regulatory and development authority of India (IRDAI) mandated a fixed premium on third-party insurance for EVs. As per the IRDAI mandate, third-party insurance for EVs for cars will be offered at a 15% discount to boost sales. For those wondering how much it costs to insure an electric car, here are policy rates, which are determined as per the battery capacity of the EV.
Check Now- Which Electric Car is Best in India
Information Required to Insure Your EV
When you seek insurance for your EV, the insurance provider will share the details about the vehicle. Usually, the insurance process for both EVs and regular cars is the same. Here are some details that insurance providers commonly ask for.
Model of your EV
- The year in which your vehicle was manufactured
- The contact information of the insurance seeker
- Whether this vehicle will be used for commercial or personal purposes.
How to Buy Low-cost Insurance for EVs?
The best car insurance for EVs does not mean that you have to buy an expensive policy. However, here are some tips from the experts that can help you buy car insurance at an affordable price.
Get Insurance Online- If you buy car insurance online, you will be able to find the best car insurance for electric vehicles as you would be able to compare the pricing and other key aspects. Insurance providers also favor online customers because they believe that the mortality risk in the customers who buy policies online is lesser than those who purchase policies online.
Use No Claim Bonus (NCB)- Insurance Companies actually reward insurance holders that do not claim during the period with a certain amount of discount on the premium. As NCB accumulates than the discount on premium increases as well.
Invest in an Anti-theft device- Protecting your EV with anti-theft damages can decrease the premium amount.
Perks of Electric Vehicles
EV is certainly the present and future of vehicles. Many carmakers are already making this necessary shift. If you are not aware of its main benefits showcasing why electric cars are better than other fuel-based vehicles.
Lower Running Costs- The running cost of an electric vehicle is much lower than other conventional vehicles. Electric Vehicles use electricity to charge their batteries instead of using fossil fuels like petrol or diesel. EVs are more efficient and combined with electricity cost that charging an electric vehicle is quite cheaper than filling petrol and other travel essentials.
Less Maintenance Cost- Electric vehicles come with very low maintenance as they don’t have as many moving internal combustion vehicles. Not only that service requirements are much lesser than other conventional vehicles. These results in running an electric vehicle are significantly low.
Tax and other financial benefits- The Registration fee and road tax on purchasing electric vehicles are much lesser than petrol vehicles. There are multiple tax benefits offered by the government depending on which state you are living in.
Check Now- How Much Electric Car Charging Cost in India
Electric vehicles are becoming very popular among buyers and it is for all the right reasons. Not only do EVs save the cost of fuel, but it also helps in sustainable development as well.
Now the government is focusing on electric vehicles, there would be an increase in the volume of charging stations and people will then switch to this green era this would certainly contribute to a healthier and safe environment for the citizens of our great nation. And don’t just invest in Electric cars but invest in insurance policies as well as this would make your and your loved one’s lives safer.