Global Electric Vehicle (EV) Insurance Market Size Zooming More Than 10X to Reach Whopping USD 401.6 Billion by 2029

Published | 21 June 2023

Global electric vehicle (EV) insurance market is flourishing due to the increasing adoption of EVs, government incentives and regulations promoting electric mobility, rising environmental concerns, advancements in vehicle technology, and the growing need for specialized insurance coverage for EVs.

BlueWeave Consulting, a leading strategic consulting and market research firm, in its recent study, estimated the global electric vehicle (EV) insurance market size at USD 38.93 billion in 2022. During the forecast period between 2023 and 2029, BlueWeave expects the global electric vehicle (EV) insurance market size to grow at a CAGR of 39.68% reaching a value of USD 401.59 billion by 2029. The increasing adoption of electric vehicles worldwide has resulted in a higher demand for insurance coverage specifically designed for these vehicles. Stringent emission norms enforced by regulatory bodies and rising environmental concerns have accelerated the adoption of emission-free electric vehicles, further driving the demand for EV insurance. Also, the rising awareness among customers about the benefits of EV insurance, such as comprehensive coverage and customized insurance plans, has led to increased demand for these policies. Insurers have also been offering unique benefits such as free charging, battery replacement, and lower premiums for safe driving, which have further fueled the adoption of EV insurance.

Opportunity: Increasing Adoption of Electric Vehicles

As people become more conscious of the environmental impact of traditional gasoline-powered vehicles, they are increasingly turning to electric vehicles as a greener alternative. This shift towards electric vehicles has increased the demand for EV insurance, which provides coverage for the unique risks associated with owning and operating electric vehicles. Companies such as AXA, and Zurich Insurance Group have recognized the growing demand for EV insurance and have developed products specifically tailored to the needs of electric vehicle owners. In addition to insurance companies, government agencies have also recognized the importance of promoting the adoption of electric vehicles. For example, the California Air Resources Board (CARB) has implemented a Zero Emission Vehicle (ZEV) program, which requires automakers to produce a certain percentage of zero-emission vehicles each year. This program has helped to drive the adoption of electric vehicles in California and has contributed to the growth of the EV insurance market. Overall, the increased awareness about the environment and the need to reduce carbon emissions is driving the growth of the EV insurance market. As more and more people switch to electric vehicles, the demand for EV insurance is expected to continue to grow.

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Impact of COVID-19 on the Electric Vehicle (EV) Insurance Market

The COVID-19 pandemic significantly impacted the global electric vehicle (EV) insurance market. Initially, the market experienced a slowdown due to disruptions in the automotive industry's supply chain and a decrease in vehicle sales. However, the pandemic also led to an increase in demand for private transport, which accelerated the adoption of EVs and EV insurance. Also, the pandemic has raised awareness of the importance of health and safety, which has led to an increase in demand for insurance coverages such as accidental damage and liability coverage. The pandemic has also accelerated the trend of digitization and the use of technology in the insurance industry. Companies have increasingly adopted digital platforms and processes to facilitate remote work and contactless transactions. Further, the pandemic has led to an increased focus on providing customized and value-added insurance solutions to customers, including usage-based insurance (UBI) and telematics-based insurance.

Global Electric Vehicle (EV) Insurance Market – By Coverage Type

On the basis of coverage type, the global electric vehicle insurance market is segmented into accidental damage, theft or malicious damage, and car battery & auto parts replacement. The accidental damage segment is the largest contributor to the global electric vehicle (EV) insurance market. This coverage is considered an essential part of standard insurance policies offered by leading players. The demand for accidental damage coverage is rising due to increasing traffic congestion and road crashes, making it a highly in-demand insurance coverage among drivers. This trend is expected to continue to fuel the segment's growth.

The car battery and auto parts replacement segment is expected to witness the fastest growth rate during the forecast period. The car battery is one of the most expensive parts of an EV, and the cost of replacing it is significantly high. Therefore, many EV owners prefer insurance plans that cover car battery replacement, and most standard insurance coverage plans designed for electric vehicles include car battery replacement as an insurance benefit. These factors are likely to boost the growth of this segment.

For instance, Allstate Insurance Company offers coverage options for electric and hybrid vehicles that cover various damages, including accidental damage and battery replacement. Similarly, Liberty Mutual offers coverage for EVs that includes battery and electric motor coverage, as well as other standard coverage options like collision, liability, and comprehensive coverage.

Competitive Landscape

The global electric vehicle (EV) insurance market is fragmented, with numerous players serving the market. The key players dominating the global electric vehicle (EV) insurance market are Allianz SE, AXA SA, Berkshire Hathaway Inc., Chubb Limited, Munich Reinsurance Company, Zurich Insurance Group Ltd., The Travelers Companies, Inc., Liberty Mutual Group Inc., Assicurazioni Generali S.p.A., MAPFRE S.A., American International Group, Inc. (AIG), Aviva plc, China Pacific Insurance (Group) Co., Ltd., Ping an Insurance (Group) Company of China, Ltd, and Sompo Holdings, Inc. The key marketing strategies adopted by the players are facility expansion, product diversification, alliances, collaborations, partnerships, and acquisition to expand their customer reach and gain a competitive edge in the overall market.

Don’t miss the business opportunity of the Global Electric Vehicle (EV) Insurance Market. Consult our analysts to gain crucial insights and facilitate your business growth.

The report's in-depth analysis provides information about growth potential, upcoming trends, and the Global Electric Vehicle (EV) Insurance Market statistics. It also highlights the factors driving forecasts of total market size. The report promises to provide recent technology trends in the Global Electric Vehicle (EV) Insurance Market along with industry insights to help decision-makers make sound strategic decisions. Furthermore, the report also analyses the growth drivers, challenges, and competitive dynamics of the market.

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