Last updated on September 5th, 2023 at 05:04 pm
Getting a handle on the cost of car insurance is important for everyone, especially if you’re responsible for keeping your household finances on an even keel.
This can get complicated if you’re also wondering whether it’s time to move from your old-school gas guzzler to a more eco-friendly vehicle.
So what are the insurance cost differences between a hybrid, electric, and gas-powered car? Let’s get into it.
What makes EVs and hybrids a more expensive insurance proposition?
The simple fact is that, for the moment at least, if you want to insure an electric or hybrid vehicle, it will be at least a bit more expensive on average than an equivalent gas model.
This means that if you want to build your savings, a greener car won’t actually help much, even taking into account rising fuel costs for combustion engine vehicles.
There are a few reasons behind this, including:
Components are expensive
While proper maintenance will keep an EV running smoothly indefinitely, if the car is involved in a crash and needs to have parts replaced, the cost is unavoidably higher.
Batteries can break the bank
The most important component of any EV or hybrid is the battery, and if this is irreparably damaged, replacing it can cost as much as $15,000.
Trained technicians are few and far between
Because they remain a minority product (at least for now), eco-friendly cars don’t have the same number of qualified mechanics available to work on them, so labor costs for repairs are higher.
All of these factors mean that insurers need to charge customers more for coverage, because they’ll have to pay out more on a typical claim.
Are gas cars always cheaper to insure?
First up, you need to compare car insurance prices to get the best deal when renewing your coverage–no matter what kind of vehicle you own.
It’s also important to point out that other factors will hold more sway over what you pay each year than whether you’re driving a hybrid, an EV, or a gas car. Providers take many things into account when coming up with their quotes, such as:
Your driving history
If you have previous convictions for driving offenses on your record, then paying more for auto insurance is unavoidable.
The value and rarity of your vehicle
If your car is expensive and uncommon, it will be costlier to insure than an everyday family-friendly model of which there are millions on the roads.
This means high-end EVs, some sports cars, and even classic cars with gas engines will be more expensive to insure.
Your age, marital status, and gender
In general, the older you get and the more experience you accrue behind the wheel, the less you’ll have to pay for car insurance.
And, because married drivers are seen as safer drivers and more financially stable, their rates are often lower.
Gender is another factor in how auto insurance is priced, with men paying slightly more. This difference is greater for younger drivers.
Your credit score
Frustratingly, the majority of US states allow insurers to use customers’ credit scores as a way of determining insurance premiums.
The size of your deductible
If you choose larger deductibles, agreeing to cover more of the costs if you need to make a claim, this reduces the amount for which the insurer is liable. That in turn can shrink the price you’re quoted.
The bottom line
In years to come, as hybrids and electric vehicles eventually become the dominant form of automobile on the roads, the differences in insurance costs will disappear, and could actually flip in their favor.
Even now, you don’t need to be overly concerned about these differences; if your budget will stretch to afford a modern hybrid or EV, then you can likely afford to pay a bit more for insurance.
Are you considering making the switch to a hybrid or electric vehicle? Or, have you already? How has it affected your insurance rates? Leave us a comment.Insurance costs: Hybrids, Electric Vehicles, and Gas Cars | MomsWhoSave.com #personalfinance #cars Click To Tweet
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