Technology is constantly evolving, especially in the automotive industry. There have been countless technological leaps and bounds over the past few years, which gives drivers the ability to take advantage of cutting-edge features and gadgets. This is especially true when it comes to electric vehicles.
Initially, electric vehicles were deemed a fad or gimmick; however, electric vehicles have proven to be an invaluable asset to modern drivers. Electric vehicles allow drivers to save a significant amount on fuel costs and reduce their carbon footprint.
Are you thinking about buying an electric vehicle? If so, you’ll need to invest in high-quality electric vehicle insurance in order to protect your new ride.
This leads to the question — How much does it cost to insure an electric vehicle in Canada?
Unfortunately, there’s no clear-cut answer; but we can give you some information that can help you estimate how much you’ll need to pay for electric car insurance.
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Is electric car insurance cheaper than insurance for gas-powered vehicles?
In most cases, no, auto insurance for electric vehicles is not cheaper than insurance for gas-powered vehicles.
In fact, insurance on electric cars tends to be even more expensive than insurance for gas-powered vehicles.
For instance, the average automobile insurance rate in Ontario for a driver licensed for 10 years or more with a clean driving record and living in a suburban area is approximately $1,900 per year (or roughly $158 per month). In contrast, the average rate for electric vehicle insurance is approximately $2,280 to $4,800 per year (roughly $190 to $400 per month).
Although the average price range for electric vehicle insurance is relatively wide, it still provides us with enough information to determine that car insurance for electric cars is more expensive (on average) than insurance for gas-powered vehicles.
What affects the cost of electric vehicle insurance in Canada?
Canadian car insurance companies assess a wide variety of general and personalized factors while determining rates for vehicles, including electric vehicles.
Some of the factors that can affect the price of your electric vehicle insurance include the following:
Personal information
Your car insurance company will use personal information to determine your car insurance rates. Some examples include:
Replacement cost of the electric vehicle
The replacement cost of your electric vehicle plays a huge role in determining your car insurance rates.
For those that don’t know, the replacement cost of your vehicle is the amount your insurance company will cover if you need to replace your car after it’s been deemed a total loss. As a rule of thumb, the more expensive a vehicle is, the higher the replacement value will be. The price of an average electric vehicle is roughly 20% more than a gas-powered vehicle (of equal quality), which means that most models will cost more to replace.
So if you’re thinking about purchasing a top-of-the-line electric vehicle, you’ll likely pay more for coverage than a driver who’s purchasing a modestly-priced gas-powered model.
Repair cost of the electric vehicle
The repair cost of your electric vehicle will also impact the overall cost of your premium.
Electric vehicles are particularly prone to physical and internal damage after getting into a collision. Repairing a modern electric vehicle can cost a significant amount due to the fact they require specialized parts that often need to be shipped from other countries. As well, the wait time for receiving these parts increases costs as the insurance company pays for a rental car while we wait for our vehicle to be fixed. The hefty repair cost of your vehicle can negatively affect your car insurance rates.
Which models have the lowest electric car insurance rates on average?
Here’s a quick list of electric vehicles that tend to cost less to insure than other electric models:
- Nissan Leaf
- Kia Soul EV
- Hyundai Ioniq Electric
- Fiat 500e
- Volkswagen e-Golf
- Tesla Model 3
- Ford Focus Electric
Why are these electric vehicles cheaper to insure? It boils down to the price point.
The models listed above are among the cheapest electric vehicles on the market. This means that they have a lower repair value and replacement value compared to other electric models. Drivers should keep this in mind while shopping for an electric vehicle in Canada.
How can you save on electric vehicle insurance in Canada?
Do you want to get the inside scoop on the best ways to save on electric car insurance in Ontario? Here are some of our top tips:
Increase your deductible
Increasing your car insurance deductible is a fantastic way to reduce your premium. The deductible is the amount that you pay for repairs when you submit a car insurance claim.
Generally, the lower the deductible, the more likely a policyholder is to submit a small or frivolous claim. Small claims are important, but they take up a lot of time and energy, which many companies would rather allocate to larger tasks. This is why insurance companies prefer when policyholders have high deductibles.
Many car insurance companies offer deals and discounts to incentivize policyholders to increase their deductibles. This means that increasing your deductible is a win-win for you and your provider!
Buy a used electric car
As mentioned earlier, the repair and replacement value of your electric vehicle will have a considerable impact on your insurance premium. If you want to save on electric car insurance, you may want to consider opting for a used electric car.
Used electric vehicles cost significantly less than brand-new models, which can lower the repair and replacement value of the car. Vehicles with modest repair and replacement values are less of a financial risk for insurance companies, which can translate to lower insurance rates.
Team up with an online insurance brokerage
If you want to save on car insurance, you should think about teaming up with a reputable online insurance brokerage, like Surex.
Online insurance brokerages work with several insurance companies across the country. This gives them the ability to provide policyholders like you with a variety of quality quotes at once!
