Can Tesla’s insurance premium in India be as low as Rs. 6707?
In recent years a new category of automobiles, EV (acronym for Electric Vehicle), has been gradually rising in popularity in India. Automobile companies such as Tata, Mahindra and Hyundai already have EVs in the Indian market and more variants are on the way. Over time they will change the way Indians commute.
EVs are vehicles that are either partially or fully powered on electric power. EVs have relatively lower running costs as they have fewer moving parts, lower maintenance and are also very environmentally friendly as they use little to no fossil fuels i.e. petrol or diesel.
From an insurance perspective as well, the premium of an EV vis-à-vis regular vehicles is calculated very differently. Let’s take a closer look at this.
There are various types of vehicles plying on the roads which include private cars, two wheelers, goods carriers, trailers & other special types of vehicles.
Four Components of private car insurance are:
The third-party insurance premium for private cars is calculated based on cubic capacity (CC) of a vehicle. Higher the CC, higher the premium. Here are some examples:
‘Own Damage’ & ‘Add-on coverage’ premium depends on various factors including age of vehicle, fuel type, prior accidents, driver’s profession and age, anti-theft devices, location where vehicle will be driven and add-on coverage.
Electric Vehicles’ Insurance
Insurance for electric vehicles will in contrast, in current times, will work rather differently.
The EV is powered by a battery of various capacities. In the case of an EV, the costliest component to be insured in an electric car is the battery, which accounts for 40-60 percent of the vehicle’s price.
Recommended by LinkedIn
IRDAI Regulations mandate the purchase of electric vehicle insurance policy, i.e. for electric vehicle car or bike owners third party insurance premium in India will be 15% lower compared to the premium of petrol or diesel vehicles.
THIRD-PARTY INSURANCE PREMIUM RATES FOR EV CARS:
Over time, as more EVs hit the road and companies study the damage and maintenance patterns, subsequently insurance policies and premiums will evolve. For instance, as battery costs reduce, it’s likely that insurance premiums may also drop.
Source: afdc.energy.gov
As per auto analysts, Electric mobility giant Tesla will soon be launching its flagship electric vehicles the Tesla Model 3, to be followed by Tesla Model S & Tesla Model Y. These vehicles are going to be state of the art & will come with features like wireless charging, panoramic sunroof, huge touch screen & zero to 100 in less than 6 seconds.
The Tesla Model 3 features a 50-kWh battery and can drive for nearly 420 kms in just 1 charge. Model 3 also has two dual-motor variants – the Performance and the Long range & both are powered by a 75-kWh battery.
As of now ‘Third-party premiums’ are determined by the size of the battery capacity.
Currently, 1% is the EV sales compared to others, but this space is going to heat up soon with the entry of Tesla.
On a lighter note, who solved the mystery of the stolen Tesla? Sherlock Ohms.
Author is Prabhat Vijh- Director & Principal Officer: iAND Insurance Broker Private Limited