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Although several cases of electric bicycle fires have been detected in recent months, nothing prevents this segment of vehicles from gaining momentum.
Although still in its infancy, property and casualty insurers are turning to this segment and recognizing its growth potential. Major insurers such as Bajaj Allianz General and HDFC ERGO have established dedicated portals that offer specialized EV services and information for potential EV buyers.
We recently looked at credit options for purchasing electric vehicles this holiday season. Today we are going to focus on the protection aspect: the insurance coverage of your electric vehicle.
Bet on electric vehicle insurance
Increased awareness of environmental benefits and political pressure from the government are likely to create fertile ground for growth in this area in the coming days.
The central government has announced tax benefits and the Insurance Regulatory and Development Agency of India (IRDAI) has introduced reduced liability premium rates for electric vehicle insurance.
To capture this emerging segment, insurance companies have begun to offer additional coverage and services. For example, Bajaj Allianz General Insurance offers services such as an EV hotline, SOS, charging information, and more. under the “EVforAll” service umbrella.
This is in addition to regular services for all auto policyholders such as roadside assistance, medical assistance, etc. charging stations, and more offers.
“A favorable political environment, increased customer awareness of environmentally friendly technologies, availability of electric vehicle models throughout the value chain, and improved charging infrastructure will allow the Indian electric vehicle market to grow and achieve significant growth in the coming years. said Parthanil Ghosh, president of Retail. The company, HDFC ERGO General Insurance, had said in the release.
fire shadow events
Electric vehicles are environmentally friendly and can deliver long-term cost savings. However, a series of electric two-wheeler fires in recent months have raised safety concerns.
“Electric bikes were heavily involved in accidents, so electric car premiums were largely unchanged. Up to 10% more for policyholders is also related to the manufacturer; with a good track record, premiums don’t necessarily increase. said a senior executive at an insurance brokerage firm.
However, some industry representatives argue that such accidents will not increase premium rates or affect the electric vehicle insurance segment. “The number of electric vehicles driving on Indian roads is still quite small. There have been some incidents such as fires. However, this number is small. Unfortunately, electric vehicle premiums have not been affected by the series of events,” says Technical Director TA Ramalingam. . Officer, Bajaj Allianz General Insurance.
Electric vehicle coverage, exclusions
In general, the insurance conditions remain the same. Premiums will be higher because the actual acquisition costs are higher than for vehicles running on conventional fuel. This is mainly due to expensive batteries.
“There is some difference due to the liability premiums and the ex-showroom price. Because electric vehicles are expensive, the declared insured value (the sum insured in case of damage or total loss) of the car is higher. So the premium will also be higher,” says Nitin Kumar, auto insurance manager at Policybazaar.com.
While there are no specific exclusions, insurance companies have yet to develop specific coverage for electric vehicles. This creates a gap.
“Electric bikes come with replaceable batteries. In gasoline or diesel vehicles, the batteries are installed inside the body of a two-wheeler, but in e-bikes, they are located on the outside. So these batteries are at risk of being stolen, but currently, standard car insurance doesn’t cover this part,” he says. Insurance companies are working on developing specific additional benefits, he adds.
Even if electric two-wheelers have been involved in fires, and some models have been recalled by manufacturers, the associated costs you incur as a result may not be covered. “The recall is due to manufacturer failure or solely to update software or other vehicle features that were originally missing. This is not within the scope of car insurance and therefore not covered,” Ramalingam explains.