EV insurance costs more
In our survey, the most frequently cited reason people would choose an EV — even more than its environmental impact — was reducing the amount spent on gas. In fact, 3 out 4 people cited that as a motivator.
And while electric vehicles do usually involve cost savings in fuel costs, the upfront cost to purchase and — by extension — the cost to insure are higher. This makes sense from the perspective of the insurance company, as they will be footing a larger bill to replace your vehicle in the event that it's totaled. Additionally, while electric vehicles usually have fewer moving parts than traditional gas-powered vehicles, when one of these parts becomes damaged it can also be more expensive to repair or replace, upping the cost of the claim. For this reason, EVs in accidents are more likely to be declared totaled by the insurance company.
Of course, the amount to insure will vary significantly depending on the model of electric vehicle you choose. For example, The Zebra’s 2022 State of Insurance Report found that the average cost to insure the comparatively cheap compact 2022 Nissan Leaf (MSRP $27,400) was $1,870. However, the cost to insure a Tesla Model X (MSRP $114,990) was $3,613 on average.