Written byMore people than ever own electric vehicles in Australia, with the likes of BYD, Tesla, Hyundai and MG being the leading brands.
Overall, there are about 180,000 cars currently on the road, according to the Electric Vehicle Council, and with Drive.com.au confirming that 20,556 new electrified cars were purchased in 2025 alone, it seems clear that ownership levels will continue to grow.
Spurred on by the desire to save money at the bowser, reduce servicing costs and lower their environmental impact, it’s clear many Aussies will follow suit in the next few years.
But for those who do make the switch to a fully electric vehicle from a hybrid or internal combustion engine, they’ll soon find themselves needing to take out electric vehicle insurance – which might beg the question of how different it is from traditional car insurance.
Well, in this post, we will attempt to answer that for you. Hopefully it will make choosing the right policy for your needs a little bit easier.
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Why Does Electric Vehicle Insurance Differ from that of Regular Cars?
All of the major insurers in Australia provide insurance coverage for electric vehicles. However, these policies do tend to differ from the ones they offer for internal combustion engine vehicles.
Many, for instance, involve paying higher premiums and mainly, this is due to EVs consisting of specialist parts that cost more to repair or replace than the main components of a regular car.
One example is the battery, which for a Tesla can cost anywhere between $5000 and $22,000 to repair, depending on the make and model of the vehicle.
At the same time, insurance companies still perceive EVs with a bit of suspicion. Some concerns remain about their potential risk of battery malfunctions, fire hazards, and other issues centred around charging points.
So, essentially, they retain a degree of mistrust about them, which affects how much they charge for their coverage.
What Coverage Options are there for EVs?
While the first electric vehicle to be launched in Australia came out in 2008 (remember the Blade Electron?), they have only really established a presence on the country’s automotive landscape since 2012, after the release of the hybrid Toyota Prius C and Mitsubishi i-MiEV.
It’s fair to say while most insurers are now offering policies specifically targeting electric vehicles, many are still work in progress.
That said, if you are looking for car insurance for your electric vehicle, here are some of the main things you should be aware of. You can also view more here.
1. Comprehensive Cover
This type of cover is the highest level you can get for your vehicle car and it covers any damage that occurs to your car, as well as third-party liabilities.
Given that buying a new electric vehicle, such as a BYD ATTO 3 or a Tesla Model Y, can be expensive for some people, many automotive and insurance experts regard comprehensive insurance as representing their best coverage option.
2. Roadside Assistance Cover
Due to the technology behind how it has been built, roadside assistance cover should be seen as an essential part of an EV insurance policy, although few companies offer it as standard.
Unlike with regular vehicles, breakdowns for electrified vehicles are viewed as more complicated, partly because they often require specialist knowledge to fix them. These types of vehicles can also be more problematic to service by the road, especially if your battery has run out of charge in a remote area.
Here are some other costs associated with roadside emergencies.
3. Battery Protection Cover
Talking of your battery, as it is the most expensive component of an electrified car, many insurers automatically protect you against the malfunction, damage or theft of it. However, this does, in turn, drive the price of your premium up.
While you might not be able to do much about theft, you should be aware that some manufacturers offer a free replacement of your battery within warranty if their level of performance drops below a certain percentage – in Tesla’s case, 70%.
It will be useful to know if your vehicle’s manufacturer offers this when choosing the level of battery protection cover you want from an insurer.
4. Damage Against Fire and Water
Today, most all-electric vehicles (and PHEVs) rely on lithium-ion batteries. However, they can be easily affected by extreme weather conditions that could result in damage caused by fire and water.
Some insurers may include protection against this in their policies, but not all do. Therefore, you will need to bear this in mind when researching coverage options.
5. Charging Station and Cable Coverage
While it’s not required for ICE vehicles, most companies offer coverage for charging your electric vehicle at a charging station or at home.
This contributes to the EV premiums generally being a little higher but also gives you the peace of mind of being covered against accidents, theft or damage that results from charging apparatus.
Other Factors Why EV Insurance Differs From Regular Cars
Aside from the above, there are a couple of other points of difference between electric vehicle insurance and that of regular petrol cars.
Although traditional factors like where you park the car, what your predicted mileage will be, whether you are buying a brand new or second-hand vehicle, and your driving history apply to both, for electric cars, the range of your battery is a factor most EV insurance premiums take into account.
Generally, the higher the range, the more expensive the car will be to insure because these types of batteries are more expensive to replace. At the same time, some companies might view the safety features of an electrified car as being less established than a petrol motor, so they charge a little extra for coverage in their premium.
