Insuring Electric Cars In Massachusetts

Electric vehicles (EVs) are typically more expensive to insure than their gas-powered counterparts. This is mainly due to their higher sticker prices, higher repair costs, and the fact that fewer repair shops are equipped to handle EV repairs. According to the National Association of Insurance Commissioners, insuring an EV can cost up to 20% more than a gas-powered car. However, as EVs become more common, the cost of insurance is expected to decrease.

Insuring an EV in Massachusetts: is it more expensive?

The cost of insuring an electric vehicle (EV) is largely dependent on the make and model of the car, the insurance company, and the state in which you live. In Massachusetts, the average yearly cost of car insurance is $469 for minimum coverage and $1,734 for full coverage. This is lower than the national average, which is $640 for minimum coverage and $2,311 for full coverage.

In general, it is more expensive to insure an EV than a gas-powered vehicle. On average, insurance for an electric car is $44 per month more expensive than for a gas-powered car, or about 20-25% more. This is because EVs tend to be more expensive to repair or replace after an accident, due to higher battery replacement costs and more complex electrical systems.

However, there are ways to find cheaper insurance for your EV. In Massachusetts, the cheapest company for electric car insurance is MAPFRE, with rates 46% cheaper than average. USAA and State Farm also offer cheap quotes for electric vehicles. Additionally, you can shop around for discounts, bundle your car insurance with another form of insurance such as home or renters insurance, or sign up for a usage-based discount program.

It's worth noting that while the cost of insuring an EV is currently higher than for a gas-powered car, there are other financial benefits to owning an electric car. For example, charging an electric car is much cheaper than filling up a gas tank, and you may be eligible for tax credits or incentives for purchasing an EV. As EV technology becomes more common, repair and replacement costs are also expected to decrease over time, which will help to lower insurance rates.

Factors that influence insurance costs for EVs

Several factors influence the insurance costs for electric vehicles (EVs). Here are some key considerations:

Higher Sticker Prices and Repair Costs

EVs tend to be more expensive to buy and repair than traditional gas-powered cars. This is primarily due to the high cost of EV batteries, which can range from $4,000 to $20,000 for a new battery, compared to $100-200 for an internal combustion engine (ICE) car battery. As a result, insurance companies may charge higher premiums to cover the potential costs of repairs or replacements.

Limited Repair Facilities

There are fewer repair shops and technicians trained to fix electric vehicles compared to conventional cars. This means that qualified repair facilities may charge more for their services due to the specialized nature of EV repairs.

Model and Make of the EV

The brand and model of the EV can significantly impact insurance costs. For example, Teslas are among the most expensive electric vehicles to insure due to their higher claim frequencies, severities, and overall higher repair and maintenance costs.

Availability of Parts and Qualified Repair Shops

As EVs become more common, the availability of parts and qualified repair shops is expected to increase, which should drive down repair costs and insurance rates over time.

Government Incentives and Rebates

Local, state, and federal governments may offer incentives for EV drivers, such as tax credits, purchase rebates, emission testing exemptions, reduced utility charges, and access to HOV lanes. These incentives can help offset the higher insurance costs associated with EVs.

Driving History and Behavior

Insurance costs are influenced by the driver's history and behavior, regardless of the type of vehicle. A clean driving record with no accidents can lead to lower insurance rates.

Annual Mileage

The number of miles driven annually can also impact insurance costs. Lower mileage may result in lower insurance premiums.

Credit Score (in some states)

In most states except California, Hawaii, Massachusetts, and Michigan, insurance companies use credit scores to determine rates. Drivers with poor credit may pay higher insurance premiums.

Insurance Company and Discounts

Insurance rates can vary across providers, and some companies offer discounts specifically for EVs. It's essential to shop around and compare quotes from different insurers to find the best rates and take advantage of any available discounts.

While EVs may have higher insurance costs due to some of these factors, it's important to note that the insurance gap between EVs and gas-powered cars has been narrowing in recent years as EV technology becomes more common and accessible.

How to save on EV insurance in Massachusetts

Electric vehicles (EVs) are more expensive to insure than gas-powered cars, mainly because EVs are more costly to buy and repair. However, there are ways to save on your EV insurance in Massachusetts. Here are some tips:

Shop around and compare quotes

Not all insurance companies charge the same rates for EVs. It is worth getting quotes from multiple companies to find the most affordable option for you. Some insurers, like State Farm, offer cheaper rates for EVs.

Look for discounts

Insurance companies offer various discounts, such as those for safe drivers, good students, vehicle safety features, and anti-theft devices. Ask about these when getting quotes.

Consider usage-based insurance

Some insurers offer discounts for drivers who participate in usage-based insurance programs, which track driving behaviours like speed, harsh braking, cornering, and phone use. If you're a safe driver, this could be a good option.

Try a pay-per-mile plan

If you don't drive your EV often, consider a pay-per-mile plan. With these plans, offered by Liberty Mutual, Allstate, and Nationwide, you're charged based on how much you drive rather than a set monthly amount.

Increase your deductible

Since EVs are costly to repair, you may be able to lower your premium by increasing your deductible, which is the amount you pay out of pocket for a comprehensive or collision claim.

Choose an EV from a traditional carmaker

EVs from traditional carmakers like Ford and Volkswagen are generally cheaper to insure than those from EV-only companies like Tesla and Rivian. This is because repair costs tend to be lower for EVs from established brands.

Bundle your insurance policies

You may be able to get a discount by insuring your EV with the company that provides your home or renters insurance.

Take advantage of tax credits

Your EV may qualify you for a federal tax credit of up to $7,500, depending on your state, income, car make and model, and the cost of your EV.

Companies that offer EV insurance in Massachusetts

When it comes to insuring an electric vehicle in Massachusetts, there are a few companies that stand out as offering competitive rates and comprehensive coverage. Here are some of the top options:

Geico

Geico is consistently ranked as one of the cheapest car insurance providers in Massachusetts, offering affordable rates for both minimum liability and full coverage policies. They are especially competitive for young and senior drivers, as well as those with a speeding ticket on their record. Geico also offers a long list of potential discounts, such as for insuring multiple vehicles, having safety features, and being a good student.

Farmers

Farmers is another affordable option for car insurance in Massachusetts, particularly for minimum liability coverage. They offer a range of discounts, including for multi-vehicle policies and young drivers. In addition to standard coverage, Farmers provides rideshare, guaranteed value, customized equipment, and personalized umbrella insurance.

The Hanover

The Hanover offers the cheapest liability coverage in Massachusetts and competitive rates for full coverage. They have been in business for over 170 years and provide a range of additional coverage options, including accident forgiveness and newer car replacement. Their discounts include multi-vehicle, safety equipment, and anti-theft device discounts.

Progressive

Progressive is a good choice for Massachusetts drivers looking for usage-based insurance. Their Snapshot® program personalizes rates by monitoring driving habits, and most participants receive an automatic discount. Progressive offers all standard coverage options, as well as coverage for classic cars, compact trailers, electric bikes, and more. They also have several discounts available, including for teen drivers, continuous insurance, and homeowners.

Allstate

Allstate is a solid option for those who prefer in-person service, as they operate through local insurance agents. They offer standard coverage options, as well as roadside coverage, Ride For Hire®, and rental reimbursement. Allstate also has a variety of discounts available, such as for anti-lock brakes, electronic stability control, and new cars.

When choosing an insurance provider, it's important to consider your individual needs and compare rates and coverage options from multiple companies. Additionally, keep in mind that Massachusetts has specific minimum insurance requirements that all drivers must meet.

Pros and cons of owning an EV in Massachusetts

Pros

• Electric vehicles have lower fuel costs than gas-powered cars. EV owners can save between $3,000 and $10,500 throughout the car's lifetime.
• EVs are better for the environment as they do not emit pollutants.
• EVs have lower maintenance costs due to their efficient electric motors, which have fewer parts than traditional cars, reducing the risk of damage.
• EVs have better performance and faster acceleration.
• EVs can be charged at home overnight, and there is an increasing number of public charging stations.
• EVs qualify for federal tax credits of up to $7,500, depending on the state, income, car make and model, and cost of the EV.
• EVs are quieter than gas-powered cars.

Cons

• EVs are generally more expensive to insure, with insurance costs being about 20% higher than for gas vehicles. This is mainly due to the higher cost of buying and repairing EVs.
• The cost of insurance varies depending on the brand of the EV, with cars from EV-only companies like Tesla and Rivian being more expensive to insure.
• Replacement parts for EVs are more expensive than for gas-powered cars due to their complex electrical systems.
• Public charging stations are not as readily available as gas stations.

Frequently asked questions