The popularity of electric vehicles is on the rise globally, including in India where manufacturers such as Tata, Hyundai, and Mahindra are selling electric cars in the market. The primary reason for the increasing interest in electric vehicles is their low running cost in comparison to traditional petrol or diesel engine cars. However, a recent report has revealed that even minor battery damage caused by accidents could render your electric car irreparable and force you to dispose of it.
Insurers are facing a challenge with electric vehicles that are built with battery pack as a structural unit, as manufacturers do not share battery data, making it impossible to repair or assess the battery pack after an accident. Models such as the Tesla Model Y, BYD Atto 3, Kia EV6, Hyundai Ioniq, and the upcoming Mahindra Born Electric range all fall under this category.
This means that if the battery suffers even minor damage, the vehicle may have to be scrapped, causing a total loss for the insurer. As batteries can account for up to 50 percent of an electric car’s value, replacing them can be costly. This issue is now being faced by insurance providers in the UK.
If there is even a minor damage to the battery pack of an electric vehicle, the entire car may have to be scrapped as many manufacturers do not share battery data with insurers. Additionally, some electric car manufacturers do not offer the option to repair the battery pack, leading to further difficulties for insurance providers and higher insurance premiums for electric vehicles. Although Tesla, one of the largest electric car manufacturers in the world, has not acknowledged any issues with insurers writing off electric vehicles, CEO Elon Musk mentioned in January that third-party insurance premiums “in some cases were unreasonably high.”
If you’re in India and concerned about potential battery damage to your electric car, one option is to consider a Return To Invoice cover. This insurance policy compensates the owner for the car’s original invoice value in case of theft or damage beyond repair. To address the issue of high repair costs and insurance premiums for electric cars, manufacturers like Tesla are reportedly developing new designs. By addressing these concerns, electric car ownership may become even more accessible and cost-effective in the future.
The rise in electric vehicles being written off by insurance companies has become a major problem for both insurance providers and scrapyards in the UK. As electric vehicles with battery packs as part of their structure cannot be repaired, they are being sent directly to the grinder, causing environmental concerns. Additionally, the UK currently lacks an electric vehicle battery recycling plant, which further exacerbates the issue. This trend also means that the lifespan of electric vehicles is shortened, resulting in the need for more production and increased pollution.
The lifespan of a lithium-ion battery for an electric vehicle (EV) can vary depending on several factors, including the battery’s chemistry, the number of charge and discharge cycles, temperature, and how the battery is used and maintained. Generally, most EV manufacturers offer warranties on their batteries ranging from 8 to 10 years, with some even offering longer warranties. In practice, an EV battery can last between 5 to 15 years or more, with some batteries retaining up to 80% of their original capacity after 100,000 miles of use.
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