A smart guide to choosing insurance for your brand-new electric car

Posted on: Feb 10, 2022 | | Written by:

A smart guide to choosing insurance for your brand-new electric car

Published on February 09, 2022. EST READ TIME: 3 minutes

The electric vehicle (EV) market in India is expected to reach USD 47 billion by 2026, up from USD 5 billion in 2020. With the pandemic disrupting consumer enthusiasm and the global supply chain, the EV market is still finding its feet, but will grow rapidly once the pandemic is contained. This will be driven by several factors – government initiatives for reducing carbon footprint as part of a worldwide movement, and innovation in the private sector to meet the expected demand.

Several start-ups have already begun production such as Ather Energy, Ola Electric, Revolt, and Ampere. Traditional players such as Bajaj, TVS, Enfield, and Hero are already reallocating resources to enhance their EV capabilities. Among indigenous manufacturers, Tata Motors has surged ahead with the Ziptron technology that will power future electric vehicles from their stable. MG Motor, too, has released an electric SUV – the ZS EV, showing their confidence in the Indian EV market.

So, if you have recently purchased an EV, it is surely a prized possession for you. Which means, you need the right kind of car insurance for it. However, there is no insurance policy specifically meant for electric vehicles at present. But you can still choose from the existing policies to financially protect yourself.

Why do you need car insurance for your EV?

The biggest role of a car insurance policy is to provide you a financial safety net. It will come in handy during an accident or if your vehicle gets damaged due to natural or manmade disasters, or even if it gets stolen. Here are more reasons why you need insurance for your electric vehicle:

1. Legal requirement

Under the Motor Vehicles Act, 1988, you must have insurance, specifically, third party liability insurance, for every vehicle that you purchase. The third-party liability insurance covers you against any damage to a third-party person or their property as a result of an accident involving your vehicle. This was made mandatory with the idea that if everyone has third-party liability insurance, then victims would be compensated adequately.

2. Financial protection

If you’re the victim of an accident, then you can claim reimbursement or compensation for the damages to your vehicle from the offender’s third-party liability plan. Moreover, electric vehicles are more expensive to repair given the rarity of their parts currently, making insurance a no-brainer of a decision.

3. Own damage

It’s possible that you may be at fault for causing an accident, and to repair your own vehicle, you would need the own damage component of a comprehensive car insurance plan to stem your losses. This is crucial as electric cars are generally more valuable than their ICE counterparts, especially in the long run. Furthermore, this also protects your car from theft and damage due to natural or manmade calamities such as earthquakes, floods, fires, vandalism, riot, etc.

Which policy should you buy?

The recommended policy for an electric car is the multi-year comprehensive insurance package, which includes a third-party liability component valid for three years, and an own damage component that must be renewed annually. This will ensure that you are always covered even if you forget to renew the own damage car insurance. However, it is recommended to avail a comprehensive insurance policy as it provides ample coverage against common exigencies. Disclaimer: The above information is for illustrative purpose only. For more details, please refer to policy wordings and prospectus before concluding the sales.

Disclaimer: The above information is for illustrative purposes only. For more details, please refer to policy wordings and prospectus before concluding the sales.

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