As more drivers make the switch to electric vehicles (EVs) in an effort to reduce their carbon footprint and contribute to a greener future, they are facing an unexpected hurdle – soaring insurance costs. Insurers, like Aviva and John Lewis, are refusing to cover EVs or charging exorbitant premiums, leaving owners shocked and frustrated. This article explores the reasons behind the increase in insurance costs for EV owners, the challenges faced by insurers, and potential solutions to make EV insurance more affordable.

The Shocking Reality of Insurance Premiums

Many EV owners have been taken aback by the skyrocketing prices of their insurance premiums. For instance, David, a Tesla Model Y owner, saw his annual insurance cost jump from £1,200 to over £5,000 when Aviva refused to renew his policy. Similar stories have emerged in online forums and social media platforms, with drivers reporting renewal quotes that are up to 940% higher than their previous premiums. The situation is not limited to Tesla owners; even those with other EV models, such as the Smart EQ Forfour, have been denied insurance or faced significant price increases.

The Factors Driving Insurance Premiums Up

Several factors contribute to the high insurance costs for EVs. Firstly, the relative novelty of EVs means that insurers have less experience setting premiums for these vehicles. With expensive features and upgrades becoming standard in EVs, the cost of repairs has also increased. Analysts estimate that claims costs for EVs are 25% higher than their petrol or diesel counterparts, and repairs take about 14% longer. The availability and cost of parts, especially for EV-specific components like batteries, further drive up repair costs. Additionally, the lack of expertise and technology in the electric vehicle repair networks poses a challenge, with a predicted shortage of qualified mechanics in the coming years.

The Impact on Drivers and the Environment

The rising insurance costs for EV owners can have significant consequences. Many owners are struggling to afford the premiums, jeopardizing their ability to continue driving EVs and contribute to reducing carbon emissions. The potential financial burden is exacerbated by the already high upfront costs of purchasing an EV. Furthermore, the lack of affordable insurance options may deter potential buyers from making the switch to electric, hindering the global effort to combat climate change.

The Response from Insurers

Insurers have not provided a unified response to the issue of high premiums for EVs. Aviva, for example, stopped covering Tesla Model Ys but has since made changes to its underwriting criteria and now offers policies for these vehicles through its Aviva Direct brand. Similarly, John Lewis temporarily paused offering new policies and renewals for fully electric vehicles while they analyze the risks and costs involved. Other insurers, such as Admiral and Churchill, continue to offer coverage for EVs, highlighting the variation in the industry’s approach to electric vehicle insurance.

The Role of Insurers in the Transition to Net Zero

Insurers play a crucial role in supporting the transition to a net-zero economy. They have the opportunity to incentivize EV adoption by offering competitive premiums and encouraging responsible driving behavior. However, the current challenges faced by insurers in accurately assessing risk and setting premiums for EVs highlight the need for industry-wide collaboration and innovation. Insurers must adapt to the changing landscape and develop fair and affordable insurance options that support the transition to electric mobility.

The Need for Collaboration and Solutions

To address the issue of soaring insurance costs for EV owners, collaboration between insurers, car manufacturers, and policymakers is essential. Insurers need access to accurate and up-to-date data on EV performance, safety, and repair costs to better assess risk and set premiums. Car manufacturers can play a role by providing insurers with comprehensive information on their EV models. Policymakers can support the development of EV-specific repair networks and encourage the training of mechanics specializing in electric vehicles. Additionally, government incentives and subsidies can help reduce the financial burden of insuring EVs.

The Path to Affordable EV Insurance

Solutions to make EV insurance more affordable include the establishment of partnerships between insurers and EV manufacturers, enabling insurers to gain insights into the vehicles’ technology and safety features. This collaboration can lead to more accurate risk assessments and lower premiums. Insurers can also explore the use of telematics and other data-driven technologies to personalize premiums based on individual driving behavior. Furthermore, the expansion of EV repair networks and the training of more mechanics with expertise in EV repairs can help reduce repair costs and, consequently, insurance premiums.

The Future of EV Insurance

As the EV market continues to grow, insurers must adapt to the changing landscape and find innovative solutions to address the unique challenges posed by electric vehicles. The transition to net-zero requires the collective effort of insurers, car manufacturers, and policymakers to create a sustainable and affordable insurance market for EVs. By working together, they can ensure that insurance premiums do not hinder the adoption of electric vehicles and contribute to a greener future.


The increasing costs of insuring electric vehicles present a significant challenge for owners and insurers alike. The relative novelty of EVs, higher repair costs, and limited expertise in repair networks contribute to the soaring premiums. Insurers must adapt and collaborate with car manufacturers and policymakers to develop innovative solutions and make EV insurance more affordable. By doing so, they can support the transition to a net-zero economy and encourage more drivers to embrace electric mobility.