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Electric vehicles are cool; how about insuring them?

Experts believe that internal combustion engine vehicles are a major contributor to environmental pollution, leading to a growing need and demand for electric vehicles.

“Electric vehicles emerged as a clean energy initiative because they offer low or zero emissions and have become an important part of Original Equipment Manufacturer (OEM) business strategies. Along with the growth in the electric vehicle segment in the country, there will be tremendous demand for electric vehicle insurance, ”said Indraneel Chatterjee, co-founder of RenewBuy, an online insurance aggregator.

In March 2020, the Insurance Regulatory and Development Authority of India (Irdai) announced that insurers would be offering a 15% discount on third-party vehicle premiums for electric vehicles to encourage their use.

“The Indian government also charges 5% GST for electric cars, which is much lower than for vehicles with internal combustion engines. The boom in electric vehicle manufacturing has begun and the government is moving into a bright future, ”said Chatterjee.

The authorities have also provided 1.5 lakh tax advantage in accordance with Section 80 EEB for interest paid as part of an EV car loan.

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Ankit Agrawal, CEO and Co-Founder of InsuranceDekho.com, said, “These electric vehicles may be a bit expensive compared to other motor vehicles, but they have their own advantages. These include low operating costs, minimal environmental pollution and, above all, savings on petrol and diesel. “

However, given the vehicle’s higher price tag, it becomes important to keep it insured in order to stay financially secure in the event of an unfortunate event.

In order for you to make the best decision about purchasing EV insurance, there are a few factors that you need to consider.

Cover: The most important thing to consider when buying EV insurance is to check the coverage features it offers. Since the parts of an electric vehicle are comparatively expensive, you need to take out adequate insurance coverage for them. If you take out fully comprehensive insurance, this usually protects you against liability and other personal damage (OD). The OD cover can help you avoid expensive repair bills in the event of accidents, natural disasters, riots, fires, as well as losses from theft, etc.

Even with private accident insurance, you are financially protected in the event of an accident. It includes bodily harm, partial or total disability due to accidents and uncertainties such as B. Accidental death.

Insured declared value: IDV is the amount that you will receive from the insurance company in the event of a total loss of the electric vehicle. A lower IDV means a lower premium and vice versa. This is an essential factor in taking out EV insurance so that you are not offered a lesser amount in the event of a future total write-off. Since an electric vehicle costs a lot, this factor becomes more and more important.

Bonus: The other important thing to consider when purchasing EV insurance is the premium. This is the amount you need to pay the insurance company to get the benefits of any insurance policy they offer. Since the premium is payable regularly, you need to choose a policy that offers an affordable premium. However, you should not forego the insurance benefits to save on insurance premiums.

Claims settlement rate: Insurance company’s CSR is an important factor to consider as it speaks about an insurer’s performance and ability to handle claims. So that you can make the most of your policy in the event of a claim, it is advisable to choose an insurance company that offers smooth claims processing.

Extensions: These are additional benefits that can be added at the time of taking out EV insurance by paying an additional premium to improve insurance coverage. You can include the additional covers in a fully comprehensive insurance, depending on your budget and needs.

You can add zero depreciation coverage to your electric vehicle insurance, where the depreciation amount is waived and the entire damage paid. The premium for these additional services can vary from insurer to insurer.

“It is recommended that consumers purchase additional covers for electric vehicles as the battery costs and specialty components for these vehicles can be costly. Risks of battery charge damage, battery leakage, damage to charging ports, vehicle towing and on-site assistance should be investigated as additional covers, ”said Chatterjee.

While electric vehicles are still in their infancy in the Indian market, they’re rapidly gaining ground and will soon take a good pie of the private vehicle market share. It is a segment that benefits consumers and the environment alike.

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