Mark Fry, engineering manager at Thatcham Research, said: “If you replace a damaged battery with a new one, once you add in other costs like labor and rental cars, all of a sudden, that’s not always the case. Repairing the car saves money.” “
A writer for the Association of British Insurers added that there are problems with the availability of repairmen in the UK. The electric vehicle insurance market is currently contentious and a bit unstable. In September, major UK retailer John Lewis was forced to stop insuring electric vehicles. Overall, a spokesman for Covea declined to clarify the reasons for the company’s change of strategy after its underwriter, Covea, withdrew cover for the vehicles.
Some U.S. insurance companies also don’t cover electric vehicles, said Tim Zawacki, an analyst at S&P Global Market Intelligence. He said the industry relies on real-world experience, which is still lacking.
Small quantity, high cost
Separately, a spokesman for major UK insurer Admiral said battery-related issues could lead to reimbursements. “Without the ability to repair, recycle or reuse batteries, it is likely that the batteries will be scrapped.” Due to their high value, a total loss was incurred. she said, declining to confirm whether electric cars were scrapped more frequently than their internal combustion counterparts.
Christoph Lauterwasser of the Allianz Technology Center, a German research arm owned by insurance giant Allianz, said damage to the underside of an electric vehicle is more likely to result in scratches on the battery casing. That results in the entire battery being replaced, which is quite expensive,” he said.
According to Allianz, electric vehicle claims currently account for only 2% of the total car-related claims handled by the company, but account for about 10% of the company’s costs.
On average, at least in Western markets, electric vehicles tend to contain a higher proportion of materials that are difficult to repair, such as aluminum or composites. If such parts are damaged in a collision, they may need to be replaced, said Ryan, who is executive director of claims at US-based collision repair specialist Mitchell. This, and the general lack of established fixes, Overall insurance costs related to electric vehicles rising Internal Combustion Engine Vehicles: However, Mandel added that the frequency of overall scrappage of electric vehicles is not currently higher than that of high-end internal combustion engine vehicles.