Electric cars are trending. If you’re thinking about getting one, you might be worried about the range and the prevalence of charging stations, but there are other things to consider, as well. Every car needs to be insured, and that includes electric vehicles. Here’s what you need to know about insurance on electric cars in Missouri.
The Future of the Electric Car
Electric cars are getting a lot of support right now.
In 2020, Governor Newsom announced that California would be phasing out gasoline-powered cars in favor of electric vehicles. By 2035, all new cars and passenger trucks sold in California will be zero-emission vehicles. Governor Newsom says, “This is the most impactful step our state can take to fight climate change.”
President Biden has also proven to be a supporter of electric vehicles. According to Car and Driver, Biden’s American Jobs Plan includes $174 billion dedicated to promoting electric vehicles and EV charging stations.
Do Insurance Companies Cover Electric Vehicles?
Before you buy an electric vehicle, it’s smart to make sure you’ll have the resources you need. In addition to scouting out the electric vehicle charging stations in your area, it makes sense to think about insurance coverage for electric cars.
The good news is that most insurance companies that insure cars in Missouri also insure electric cars. Finding coverage for electric versions of vehicles should not be a problem.
The Cost of Owning and Insuring Electric Cars
Electric cars are seen as expensive – for good reason. The National Resources Defense Council says that the average sticker price for an electric vehicle is about $19,000 higher than the average sticker price for a gas-powered car.
Because electric cars are expensive to own – and expensive to repair – the cost of insuring electric cars can also be expensive. According to Self, annual car insurance premiums for electric vehicles cost an average of $442 more compared to car insurance premiums for gasoline-fueled cars.
The takeaway? It’s more expensive to insure an electric car, so when purchasing an electric car, take Missouri insurance costs into account.
But it’s not all bad news. People who own electric cars catch a break when it comes to fuel costs. The National Resources Defense Council says the exact savings will depend on a number of factors, including the cost of gas and electricity in your area. In Washington, you can expect to save $14,480 on energy costs over a 15-year period.
Even better, the cost of electric vehicles is expected to drop in coming years as batteries become cheaper. According to Fast Company, the price of electric vehicles has fallen by 89% in the last decade. In a few more years, electric vehicles might cost the same as gasoline-powered vehicles.
What Type of Car Insurance Coverage Does Your EV Need?
Your electric vehicle can benefit from the same basic coverage types as gasoline-fueled vehicles.
- Liability insurance covers losses to third parties. Coverage is available for both bodily injury liability and property damage liability.
- Collision and comprehensive insurance covers losses to your own car. Collision insurance provides coverage for collisions or crashes, while comprehensive insurance provides coverage for other types of losses, such as theft, vandalism, storm damage, and animals.
- Uninsured motorist coverage covers losses that you may experience if you are hit by an uninsured driver. You can also purchase underinsured motorist coverage in case you are hit by a driver with insufficient insurance limits.
- Personal injury protection (PIP) covers medical costs for you and your passengers.
- Gap insurance covers the difference between the value of your vehicle and the amount you owe in the case of a total loss. Because vehicles depreciate quickly, this coverage can be a smart investment on new vehicle.
Make sure your charging station is covered, too. If you’ve installed a home charging station for your electric vehicle, talk to your insurance agent to make sure your Missouri homeowners insurance covers it adequately.
What Insurance Limits Do You Need for Your EV?
When selecting insurance limits for your electric vehicle, there are three important requirements to consider:
- What are the insurance minimums in Missouri Each state establishes its own requirements for insurance coverage. In most states, liability insurance is mandated, and drivers must meet the state’s minimum amounts. Some states may also require additional types of insurance coverage, such as personal injury protection (PIP) and uninsured motorist coverage. When you purchase insurance, you will have to enter your location. Your insurance partner should make sure you are meeting your state’s legal requirements.
- What does your lender require? If you have an auto loan, your lender will likely have some insurance requirements. You will probably have to maintain adequate amounts of collision and comprehensive insurance. You may also need to list your lender on your insurance policy.
- How much coverage do you need to protect your assets? If you cause a crash and the losses exceed your auto insurance limits, you can be on the hook for the difference. Therefore, it can be smart to carry higher limits, especially if you have assets you want to protect, or if your state has especially low minimum requirements. You may also need additional coverage based on your vehicle use. For example, if you use your personal vehicle for commercial purposes, you may need commercial coverage and higher limits.
How to Keep Costs Down for Electric Vehicles
Many people like electric vehicles because of their sustainability – but the situation has to be sustainable for your wallet, as well. Although this might change in the future, right now, it can cost more to insure and own an electric car. If you own an electric vehicle or are thinking of buying one, take the following steps to keep the cost of insurance on electric cars down.
- Look for tax rebate programs. You may qualify for tax credits or rebates if you purchase an electric car. The S. Department of Energy has information on federal tax rebates for electric vehicles.
- Ask about insurance discounts. Don’t leave money on the table. You may qualify for a number of discounts, such as safe driver discounts. Your electric vehicle may also help you qualify for some insurance discounts.
- Keep a clean driving record. Your car isn’t the only thing that impacts your insurance rates. Your driving history also plays a major role. Avoid crashes and claims to keep your insurance rates low.
- Consider a usage based insurance (UBI) policy. If you are a consistently safe driver, a usage based insurance program (in which your driving behavior is monitored by your phone) can be a money-saving option.
- Ask Mid Rivers Insurance to shop and compare for you. Insuring an electric car doesn’t have to break the bank. Different insurance companies will give you different rates, so shop around for a good deal. As an independent insurance broker, Mid Rivers Insurance has connections with many top auto insurers, so we can shop the market on your behalf and help you assess your options.