Does having an electric vehicle affect your auto insurance?, Money News
Short answer? Yes, having an electric vehicle affects your car insurance policy. Long answer? Here are the details.
Electric vehicles are rapidly gaining ground in Singapore, with the number of electric vehicles there more than doubling in 2021. This upward trend is expected to continue under the Singapore Green Plan 2030 as the government continues to advocate and encourage strongly the increased use of electric vehicles.
While everyone seems to be switching to electric vehicles, the burning question on everyone’s mind is how your current car insurance policy will be affected by buying a new electric car. What are the differences between insurance policies for electric and non-electric cars, and how will your new vehicle be protected?
To this end, here are 3 essential points to know about electric car insurance in Singapore.
EV car insurance is relatively rare and expensive
Compared to insurance policies for gasoline or diesel cars, insurance policies for electric vehicles can be relatively rare. Currently, only a few car insurance policies in Singapore are designed to cover electric vehicles, limiting your choices.
EV insurance policies are more expensive than your current policy. Most electric car models are more likely to be in the luxury class than traditional internal combustion engine vehicles, making them more expensive to insure.
Electric vehicle parts are also more expensive and less manufactured than their non-electric counterparts, meaning each individual car part costs more to repair and maintain.
This is mainly due to the fact that electric vehicles are more expensive than non-electric cars, which means that their spare parts also cost more to repair and maintain. Electric cars also run on large, expensive batteries that are expensive to repair if they break down.
All of this leads to higher maintenance and protection costs, reflected in the insurance premiums you pay.
EV car insurance policies are more personalized
Typically, car insurance premiums are calculated based on various factors such as your age and driving experience.
EV insurance policies go a step further and consider additional aspects such as the make and model of your car when calculating your premium and designing your insurance policy.
The downside is that it can be difficult to receive a direct online quote for your EV insurance policy. Unlike the usual car insurer who will likely provide you with an instant estimate of your premiums after a few clicks on their website, EV car insurers can take up to a few business days to tailor an accurate quote to your needs.
However, it also means that your car insurance policy will be much more personalized to your unique profile and needs, since you are providing the insurer with more specific details about yourself and your vehicle.
You can pay per kilometer with your EV car insurance
Compared to the annual model currently used for cars with internal combustion engines, owners of electric cars can now opt for usage-based insurance that allows them to pay according to their consumption.
For petrol or diesel cars, car insurance in Singapore usually requires customers to pay a fixed amount up front. Still, some electric car insurers have started offering customers a post-paid pay-per-mile option, also known as usage-based insurance (UBI).
Under this option, customers must pay a fixed cover charge of S$150 per year. The specific monthly premium will then be calculated based on the distance traveled by the customer each month. Customers can therefore be sure that they are not paying extra for coverage or maintenance services that they will never use.
Innovative insurance options come our way
The strength of EV insurance policies is their ability to customize, but hearing that these policies are currently rare and expensive might be a little disappointing.
But don’t worry – emerging innovations in the auto insurance industry suggest the future is bright.
Tesla, arguably the biggest maker of electric cars right now, has started offering its own insurance option to customers buying their electric vehicles.
Tesla auto insurance is unique in that it incorporates technology to optimize and reduce EV insurance costs. They monitor customers’ daily driving behavior in real time to estimate their level of driving safety, which predicts the likelihood that they will need maintenance or repair in the near future. Their monthly premiums are then calculated based on these security forecasts.
With recent trends showing that these safety predictions have been largely accurate in estimating customers’ driving behavior, this is a great way to optimize the price of their insurance premiums by ensuring customers are not don’t have to pay too much.
Tesla’s in-car technology is also accurate in identifying factors such as the causes of accidents, further minimizing costs by handling claims much faster and easier.
Although this insurance option is currently only available to US Tesla customers, other insurers may follow suit by pursuing similar innovations, dramatically reducing the price of EV car insurance across the board.
Choose the Best EV Car Insurance Plan
The Singaporean government has steadily increased the number of charging stations across the island to ensure that every HDB city is EV-ready by 2025, which means owning an electric car will become much more convenient than it used to be. ‘is actually. Electric vehicles are also known to be the greenest option, so making this switch could be a great way for you to reduce our carbon emissions.
This means that now may be the time for Singaporeans to switch to an electric car.
Be sure to choose the best electric car insurance for your vehicle when making the switch so that you are well prepared for any situation you may face in the future.
This article was first published in ValueChampion.