EV insurance typically costs more than insuring a comparable petrol or diesel car in Australia. You can expect to pay anywhere from 5% to over 60% more depending on the vehicle model, price bracket, and insurer. For example, a Tesla Model Y might cost around $2,500 annually to insure, while a similar Toyota RAV4 Hybrid sits closer to $1,780. The gap narrows or widens based on the specific EV and how insurers assess repair costs, parts availability, and accident risk.
This article breaks down exactly why EV premiums run higher, shows you how to calculate whether your next electric car will cost more to cover, and reveals the factors that push your premium up or down. You’ll also discover practical ways to reduce what you pay, plus what the current Australian market looks like for EV insurance. By the end, you’ll know whether switching to an electric vehicle means a bigger insurance bill and what you can do about it.
Why EV insurance is often pricier in Australia
Your electric vehicle carries more expensive components and specialised technology that make repairs cost significantly more than fixing a traditional petrol car. Insurers calculate premiums based on what they’ll likely pay out in claims, and when your EV needs repairs after an accident, they face higher bills for replacement parts and longer wait times to source those components. Battery packs alone can run into tens of thousands of dollars to replace, and even minor crashes can damage sensors, cameras, and advanced driver assistance systems that cost far more than conventional bumpers and panels.
Complex repairs and scarce parts
Repairing your EV means dealing with limited parts availability across Australia. Most electric vehicle components must be imported from overseas, which adds weeks or months to repair timelines. You’ll find that replacement batteries, electric motors, and control modules aren’t sitting on shelves at local auto parts stores like alternators or radiators for petrol cars. Insurers know these delays mean they’ll pay for longer hire car periods while your vehicle sits waiting for parts, pushing up their costs and therefore your premium.
Replacement part shortages cause the biggest challenges when fixing electric cars, often due to limited availability and the time it takes to source the right component.
Shortage of trained mechanics
Australia faces a severe shortage of qualified EV technicians, with only a fraction of mechanics trained and certified to work on high-voltage systems. Your insurer must send your damaged EV to authorised repair centres rather than any local workshop, and these specialist facilities remain scarce outside major cities. Fewer repairers means less competition and higher labour rates, which insurers factor directly into your premium calculations.
How to work out if an EV will cost more to insure
You can determine whether is ev insurance more expensive for your specific situation by comparing quotes directly between the EV model you want and similar petrol or hybrid alternatives. Request quotes for the same coverage level, excess amount, and driver profile across both vehicle types to see the actual dollar difference. Most insurers provide instant online quotes that let you test multiple scenarios in minutes, giving you hard numbers rather than guesswork about your potential premium.
Get quotes for comparable models
Start by identifying a petrol or hybrid vehicle that matches your desired EV in size, price, and features. If you’re considering a Tesla Model 3, compare it against a Toyota Camry Hybrid or BMW 430i Gran Coupe with similar list prices. You’ll get the most accurate comparison when both vehicles sit in the same price bracket and vehicle class, since insurers assess risk differently for small hatchbacks versus large SUVs.
Request quotes using identical driver details and coverage specifications for both vehicles. Set the same excess level (typically $600 to $1,000), choose comprehensive cover for both, and input the same address, driving history, and usage patterns. Recent data shows electric vehicles in the $50,000 to $75,000 range average around $2,015 annually, while comparable hybrids cost roughly $1,169, revealing a potential $846 difference.
Electric vehicles in mid-price brackets can cost 70% more to insure than similar hybrid models, though the gap varies significantly by brand and model.
Calculate the total ownership cost
Factor your annual insurance premium into the broader ownership equation alongside electricity costs, servicing expenses, and depreciation. Your EV might save you $2,000 yearly on fuel but cost an extra $800 in insurance, making the net benefit $1,200 rather than the full fuel saving. Understanding this complete picture helps you decide whether the higher premium represents good value or a deal-breaker for your budget.
What actually pushes EV premiums up or down
Several specific factors determine whether is ev insurance more expensive for your situation, and understanding these helps you predict what your insurer will charge. Your vehicle’s purchase price, technology package, and safety features form the foundation of premium calculations, but your personal driving record, location, and usage patterns can shift the final number by hundreds of dollars annually. Insurers weigh these elements differently, which explains why you’ll see significant premium variations between models and drivers.
Your vehicle’s price tag and technology level
Higher-priced EVs carry steeper premiums because insurers must cover the full replacement cost if your vehicle gets written off. A $90,000 Mercedes-Benz EQA costs around $4,243 annually to insure, while a $37,000 BYD Dolphin sits closer to $1,899. The difference comes down to raw vehicle value rather than purely the electric drivetrain, since expensive petrol cars also command higher premiums.
High-value cars generally cost more to insure, and EVs generally cost much more to buy than their combustion engine equivalents.
Advanced technology packages increase your premium because they cost more to repair when damaged. Your EV’s cameras, sensors, and driver assistance systems require specialist calibration after even minor accidents, pushing repair bills higher than traditional vehicles. Insurers know that fixing these systems means paying for expensive diagnostic equipment and certified technicians, so they price this risk into your policy from day one.
Your driving history and usage patterns
Your claims history and driving record affect EV premiums just like any vehicle insurance. Insurers charge you less when you’ve maintained a clean record with no at-fault accidents over the past three to five years. They’ll also consider your annual kilometres driven, with higher mileage increasing your accident risk and therefore your premium.
Where you park and live
Your postcode and parking arrangements directly impact what you pay. Keeping your EV in a locked garage overnight results in lower premiums than street parking, since insurers face reduced theft and weather damage claims. Living in areas with higher accident rates or vehicle theft statistics pushes your premium up regardless of your personal driving record.
Ways to cut the cost of EV insurance
You can reduce your EV insurance premium through several practical strategies that insurers reward with lower rates. These methods don’t require you to compromise on coverage quality or take unnecessary risks with your vehicle. Most drivers can implement at least two or three of these tactics immediately and see measurable savings when they renew or switch policies, often cutting hundreds of dollars from their annual insurance costs.
Choose a higher excess amount
Increasing your excess payment from $600 to $1,000 or higher can drop your premium by 10% to 20% annually. Insurers offer this discount because you’re taking on more financial risk yourself, which means they’ll pay out less on smaller claims. You’ll need enough savings set aside to cover the higher excess if you do make a claim, but this trade-off works well when you have a strong driving record and rarely file claims.
Raising your excess to $1,000 or more typically reduces your premium by 10% to 20%, saving you hundreds annually while requiring you to cover more of any claim costs.
Bundle multiple policies together
Combining your EV insurance with your home and contents cover under one insurer delivers multi-policy discounts of 5% to 15% on each policy. Ring your current insurer to ask about bundling options, or get quotes from insurers that specialise in multiple policy types. This approach also simplifies your insurance management by dealing with one company for renewals and claims across all your policies.
Limit your annual kilometres driven
Declaring a lower annual mileage brings down your premium since insurers price based on accident exposure. If you work from home or drive less than 10,000 kilometres yearly, make sure your insurer knows this. Some policies offer pay-per-kilometre options that track your actual driving and adjust your premium accordingly, which can slash costs significantly for light users.
Shop around every renewal period
Comparing quotes from multiple insurers reveals whether is ev insurance more expensive with your current provider than competitors. Loyalty doesn’t pay in Australian insurance markets, with new customers often getting better rates than long-term policyholders. Get at least three quotes before each renewal to ensure you’re not overpaying for identical coverage.
EV insurance in Australia today and what to expect
The Australian EV insurance market sits in transition right now, with premiums remaining higher than petrol alternatives but showing signs of gradual stabilisation as more insurers enter the space. You’ll find that is ev insurance more expensive today compared to 2022 or 2023, though the gap between electric and combustion vehicles has narrowed slightly for some models and price brackets. Market competition continues to intensify as traditional insurers and new specialists vie for a growing pool of EV owners across Australia.
Growing competition brings better rates
More insurers now offer dedicated EV policies or improved pricing on standard comprehensive cover for electric vehicles. This increased competition means you’ll find wider premium variations between providers than you would have seen two years ago, making comparison shopping more valuable. Expect insurers to continue refining their risk models and pricing algorithms as they accumulate more claims data from Australia’s expanding EV fleet.
Future premium trends
Your premiums should decrease gradually over the next three to five years as repair networks expand and parts become more readily available across Australia. The motor industry urgently needs 49,000 trained EV technicians in New South Wales alone, and addressing this shortage will help bring repair costs down, which insurers will eventually pass through as lower premiums.
Final thoughts
Understanding whether is ev insurance more expensive in Australia comes down to your specific vehicle choice and how you shop for coverage. While EVs typically cost more to insure than petrol alternatives, the gap varies dramatically by model, with some premium differences reaching 60% and others sitting under 10%. You’ll pay the least when you compare quotes aggressively, choose sensible excess levels, and consider your total ownership costs rather than premiums in isolation.
Your best move involves getting multiple quotes before committing to any electric vehicle purchase, then repeating that comparison at every renewal. Market competition continues to improve pricing for EV owners across Australia. Compare car insurance options at National Cover to find coverage that protects your investment without draining your budget unnecessarily.
