Electric Vehicles (EV) in Insurance - Thematic Research

GlobalData forecasts that the global EV insurance industry will rise from $49 billion in 2020 to over $507 billion in 2033 as EVs become increasingly pertinent to consumers, manufacturers, and governments alike. Challenges to claims management and control - including battery costs, supply chain issues, underdeveloped repair networks, and insufficient charging infrastructure - remain major sticking points for insurers. Meanwhile, the data-driven future of connected cars will continue to challenge the status quo of the motor insurance market going forward. This report examines these factors, exploring the EV space in terms of key trends, major players, and future outlook.

The automotive industry is undergoing an unprecedented evolution, and the rapid, global spread of electric vehicles (EVs) is the most immediately pressing matter in the industry. The electrification of transport is seen as a key hurdle to overcome in the global systemic transition towards net-zero emissions targets. Falling EV prices, greater battery ranges, and sufficient charging infrastructure will contribute to the worldwide proliferation of EVs, growing the market for EV insurance in parallel. The insurance industry must ensure it stays abreast of the changing motor vehicle landscape. Understanding and pricing the risk profile of these new vehicles without decades of data and experience is an immediate challenge-a race against time as insurers look to perfect this work as the prominence of EVs grows around the world. Battery costs, advanced in-vehicle technologies, and underdeveloped yet still constrained supply chains are driving high claims costs for EVs, although falling costs and maturing repair networks will moderate these factors over time.

Scope

• The cost of batteries remains the main driver behind EV insurance premiums, as such a high proportion of the total car cost is attributed to the battery pack.
• Claims management will keep premiums higher in the short run, although this issue will abate in the longer term.
• Original equipment manufacturers may have an opportunity to disrupt the status quo of the motor insurance industry with connected car capabilities and superior knowledge of their own vehicles.
• Leading insurance providers have a standalone, EV-specific product for customers, often taking into consideration any liabilities or damages cause by or to the charging apparatus.

Reasons to Buy

• Visualize the growth potential of global electric vehicle insurance markets.
• Identify key challenges and opportunities arising within the space.
• Benchmark yourself against the progress of leading insurers within this developing sector.