Are your clients concerned about electric vehicle insurance costs?

Consumer interest in electric vehicles (EVs) in Ontario appears to be waning as drivers raise concerns over costs and charging infrastructure, said a new survey from LowestRates.ca.

While 43% of polled Ontario drivers said they were considering making an EV their next vehicle, 75% had concerns related to purchase, maintenance and repair costs, availability of charging stations and size of the current charging network, and the practicality of charging the cars at home.

In particular, 55% of polled drivers cited sticker price as a concern, 49% were concerned about the number of charging stations available, and 40% were concerned about installing home chargers.

Another survey from BrokerLink last year found more than three-quarters (78%) of respondents were concerned about the cost of their EV insurance premiums. For its part, LowestRates.ca polled 816 drivers between Jan. 12 and Jan. 15 who used the rate aggregator’s auto quoter.

That survey found that 88% of respondents in Ontario drove gas-powered vehicles. While 43% said they were considering an EV or hybrid vehicle for their next car purchase, a similar percentage (41%) were not considering buying a green vehicle at all.

“While insurance costs for EVs and gas-powered vehicles are relatively comparable now, that may change as EV adoption becomes more widespread,” said Steven Harris, a LowestRates.ca expert and licensed insurance broker. “Anyone choosing to purchase an EV or hybrid should research their insurance options upon purchase, but also annually on renewal, as this sector is likely to change quickly and insurers will adapt premium pricing accordingly.

“As EVs become more popular, insurance rates will likely become more competitive due to the increased availability of parts for repair and a corresponding drop in maintenance and repair costs.”

Costs to insure the top five most queried EVs on LowestRates.ca (all Teslas) were between about $3,500 and $5,000 annually, LowestRates.ca said. There is also a direct correlation between gas prices and EV interest, Jodi Lai, editor-in-chief of AutoTrader.ca, said in a LowestRates.ca blog. “When gas prices are high, EV interest is also high.”

Teslas are unique in that they require specialized maintenance from authorized autobody shops, which can increase the cost of repairs. But they also grant owners access to their robust supercharging network, which is an advantage for people who are concerned about charging.

In LowestRates.ca’s survey, about half of respondents were worried about availability of charging stations and 40% were worried about the ability to install one at home.

But Lai said EVs aren’t the best solution for everybody. People who live in condos without chargers, those worried about battery performance in sub-zero temperatures and residents of provinces without generous zero-emission vehicle (ZEV) rebates may find it challenging to eliminate gas-powered vehicles.

“But this could change very quickly,” LowestRates.ca said. “The current charging network is already more robust than people think, with more stations on the way… As Canada gets moving on its federal ZEV mandate, the EV revolution could already be underway.”

 

Feature image by iStock.com/stockstudioX