Rise in E-car demand

Industry experts believe that demand for e-cars would grow in forthcoming years due to rising consumer awareness and stricter emission norms.

Auto companies have also taken electric vehicles seriously with companies such as Tata Motors and Mahindra & Mahindra already out with their e-cars.

Thoough electric cars are more expensive than petrol and diesel cars, they come with advantages like being noiseless and non-polluting. However, along with paying a higher price to buy these cars, electric vehicle owners should also be prepared to shell out more to insure them.

With the numbers of electric cars being limited, no separate cover is available currently. Insurers would face certain issues in offering them. The electric cars attract higher premium rates than diesel and petrol cars because in case of any damage getting it repaired is coslier. The technology used in building these cars is advanced, and thus would need special mechanics to repair them. As of now, electric cars are covered by the same motor insurance policies that govern insurance for fuel based vehicles.

“At present insurance cover for electric vehicles come with some limitations as insurers do not have any historical claims data,” says Jaideep Devare, managing director, Mahindra Insurance Brokers.

“Underwriting of electric vehicles is slightly different as accidental repairs can involve replacement of entire parts such as body shell, motor and battery assemblies,” adds Devare.

“As there is no cubic capacity for an electric car, insurers take into account its kilo watt to calculate the premium,” says Sasikumar Adidamu, chief technical officer, Bajaj Allianz General Insurance. Instead of engine number, the battery number is documented while insuring them.

Their batteries and other specialised parts are also expensive.

“Before buying insurance, ensure that the cover is being provided at the right value of the vehicle. The coverage should be adequate so that your share in an accidental claim is minimal,” says Amitabh Jain, head-motor and health underwriting and claims, ICICI Lombard General Insurance.

Adds Rakesh Jain, ED and CEO, Reliance General Insurance: “Since the battery and electricity supply unit is the key component of an electric car, the mechanical, electronic and electric failure of the battery and electricity supply unit should also be protected by opting for suitable warranty products.”

As the cost of repairing these vehicles is high, a zero depreciation add-on cover can be useful.

During a claim, the insurance company calculates the depreciation value of the car, which is then deducted from the claim amount. The full amount is paid, with a zero depreciation add-on cover.