Electric car owners are facing an astonishing increase of up to 1000 percent in their insurance premiums amidst a cost of living crisis, according to recent reports.
In a perplexing turn of events, some owners have witnessed their premiums skyrocket by over £4,000 compared to last year, leaving them questioning the reasons behind such exorbitant price hikes just before the onset of winter.
Sharing their woes in a Facebook group, Tesla owners have expressed their shock and frustration at the unprecedented premiums they are now required to pay.
One owner recounted how Aviva refused to renew their insurance policy for their Tesla Model Y, and they were met with similar rejections from other insurance brands.
This disturbing trend comes shortly after Prime Minister Rishi Sunak implemented a new governmental policy on the sale of new petrol and diesel cars, following substantial investments by manufacturers in the UK’s electric car market.
Tesla driver, David, recounted his experience to The Guardian, stating, “My insurer was Aviva from July 2022 to July 2023, but when it was time for renewal, I received a letter notifying me that they would no longer provide coverage for the Tesla Model Y.”
David further shared, “I’m a member of a Tesla UK owners forum, and I have noticed that many others are dealing with the same issue. I spent weeks searching through various comparison sites and approaching individual insurers and brokers, but either the car was not covered, or the quotes exceeded £5,000.”
David revealed that the best quote he received was £4,500 from Direct Line, and once interest was factored in, the price surpassed £5,000. Disturbingly, David’s predicament is not an isolated incident among electric car owners.
Alex Gherlis, who drives a Smart EQ Forfour, a city car with an average retail price of £20,000, faced a similar rejection from John Lewis Finance just before his renewal date in mid-August. The insurer stated that they no longer provide coverage for electric vehicles.
For owners like Alex and David, these rejections coincide with the most challenging time of the year in the UK. As temperatures drop and energy costs rise, any increase in insurance premiums will have a more significant impact.
While all drivers face premium increases, petrol car owners are experiencing relatively smaller rises, with an average of just 29 percent according to Confused.com.
Louise Thomas, a motor expert at Confused.com, commented on the situation, saying, “Although electric vehicles are becoming more commonplace, they still represent the minority of cars on UK roads. As a result, insurers have limited experience in setting premiums for this type of vehicle.”
In addition to rising premiums, electric car drivers face other risk factors. Paul Baxter, the CEO of Green Insurer, highlighted the high costs associated with electric vehicles and the relative scarcity of parts as significant factors.
Furthermore, the repair networks lack the necessary expertise to handle the intricate technology found in electric cars. Baxter explained, “When it comes to repairing traditional cars, professionals have reached a high level of expertise. However, they have not yet achieved the same level of proficiency with electric vehicles.”
Aviva responded to the situation, stating, “Although we provided insurance coverage for the Tesla Y Model last year, we revised our acceptance criteria during the year and were unable to offer a policy upon renewal. However, we have made further changes and are currently able to underwrite these vehicles through some of our products, with expectations of others following suit.”
Direct Line also commented, saying, “We determine customers’ policy prices based on our risk assessment and rating factors, which include the car model and inflation. Like many other industries, insurers are currently facing increased costs.”
Express.co.uk has reached out to Tesla and Aviva for additional comments.
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