Martin Lewis reveals how to save money on car insurance
Car insurance premiums for electric cars are currently some of the highest on the market due to the overall value of replacing vehicles when they break or suffer damage. Costs are also high due to the specialist equipment and repairs needed during accidents compared to normal patrol and diesel owners.
However, experts at USwitch warned costs would fall, making electric cars “more accessible” to road users across the market.
Ben Smithson, spokesperson for the firm said he was confident the market would eventually “undergo a degree of correction”.
He said: “In order to calculate your premiums, when considering the insurance group of your vehicle, insurers assess a number of factors including the value of the vehicle, the ease of finding a professional qualified to repair the model and the cost and availability of parts.
“While some electric vehicles are more expensive to insure due to the cars’ higher purchase price, the need for specialist equipment and repairs, and a lack of data on driver behaviour.
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“As more drivers make the switch to electric, it is predicted that the insurance market will undergo a degree of correction.
“As a result, premiums will eventually fall, making EVs and Hybrids more accessible to a range of drivers.”
A survey from USwitch found almost one in 10 drivers think electric car premiums would be more expensive.
One in eight 18-24-year-olds said these higher costs would encourage them to not make a purchase for a new electric model.
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Experts at Admiral have confirmed drivers do not need specialist insurance for an electric car.
They said insurance firms are working to normalise electric car ownership as much as possible.
Admiral said they also consider whether an accident is more likely because electric cars offer a different driving experience.
They warn some electric models can offer peak pulling power and surprising acceleration which could catch many drivers unaware.
The cars are also relatively silent which may increase the risk of drivers suffering accidents.
Ultimately, all cars are placed into car insurance groups based on their overall value and the availability of spare parts.
Compare the Market warns an electric-powered Nissan Leaf would usually be found in insurance groups 20-25.
Meanwhile, the Ford Focus would be in groups 7-14 and would likely pay less to run on the road.
However, Compare the Market warns electric car ownership can be cheaper in some cases.
The average annual car insurance cost in 2020 was £702 per year with a Ford Focus Ghia priced at £703.02 for a year’s agreement.
Meanwhile, drivers were able to secure a policy for a Nissan Leaf Tekna for just £503 last summer proving the market is still competitive.
More expensive electric cars such as Tesla’s Model 3-Performance do come with heavy costs.
Compare the Market has warned the electric sportscar has average annual premiums of over £1,350 in a major blow to many.
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