China’s car market is now generally recognized to be the largest one in the world, and the adoption of electrification is happening at a rapid pace. However, Chinese consumers are now dealing with an unexpected side effect of the push towards “new energy” vehicles: significantly increased insurance premiums.



CNBC reports that insurance premiums for new energy cars (which includes EVs and hybrids) are, on average, 20 percent higher than they would be for traditionally fueled vehicles. According to Wenwen Chen, Director at S & P Global Ratings, who is in charge of the firm’s research for China Insurance, companies have found that the loss ratio is significantly higher for new energy vehicles than for internal combustion vehicles. This is one of many factors that go into determining insurance pricing, and Chen states that it may be higher due to new energy vehicles using parts that are not yet mass-produced and therefore are costlier.

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Chinese EV Buyers Are Getting Hit With Much Higher Insurance Premiums

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