Electric Vehicle Fires: What You Need to Know About Insurance

With the government’s push and easy-to-use features, electric vehicles (EVs) are becoming popular day by day. Even though EVs are growing in popularity they do come with some risks. The possibility of a fire in the vehicles is one of the most concerning risks. The news reports of EVs catching fire are not uncommon. 

What is covered by insurance?

Speaking to Outlook Money, Amit Gupta, Managing Director at SAG Infotech, said, “As with all vehicle insurance policies, in terms of electric cars, there are two main plans. First is a third party plan. This is insurance that you have to purchase, according to the motor vehicles act of 1988, in order to insure your electric vehicle. This plan will cover you with regards liabilities arising from third party injury and property damage caused by your electric car. However, this plan does not offer you a third party coverage which means you will not get compensation for damages that may be incurred by your car due to an accident.”

Also Read: Investing in Stocks vs. Mutual Funds: A Tale of Risk and Reward

“Comprehensive plans are great car insurance for your electric vehicle. It offers cover to third party and own-damage claims. Comprehensive car insurance plan will cover your vehicle in cases when it becomes unserviceable due to a riot, vandalism or natural disaster,” Gupta said.

Generally, the cost of repairs or replacement is covered under insurance in case your EV catches fire but you must keep these important points in mind: 

Need for comprehensive coverage: Only damage to other vehicles or property is covered under insurance from a third party. You should get comprehensive coverage to stay protected against fire damage costs.

All damages are not covered: There are some motor insurance policies which exclude damage by mechanical defects like short-circuiting or overheating.

Amount of coverage depends on vehicle IDV: The IDV (insured declared value) is the maximum amount your insurance company will pay for your vehicle if it is a total loss.

Recently, a new general insurance company floated electric vehicle add-on covers to protect batteries and accessories. They offer protection in case of consequential loss to the battery or parts of the battery. This new insurance covers private charging stations, charging accessories and protection of the cars during charging.

“In the event of an accident, you can rely on an electric car insurance policy to pay for your damages. It is also an indemnity against such liability claims arising from the death, injury or damage to other people’s property as a result of the accident. Get the best EV insurance and get it online today if your electric car is yet uninsured,” Gupta added.

Steps to protect yourself

These are a few things you must do to protect yourself from the burden of an EV fire:

Buy comprehensive insurance: Buying comprehensive insurance to protect you against EV Fire’s financial burden is of utmost importance.

Read your policy document carefully: Make sure that you read every bit of the insurance document and understand what is and is not covered by your policy.

Take care of your vehicle: Keep the battery and electrical system of your EV in good condition.

Have your vehicle inspected regularly: Take your EV to a qualified mechanic who can check your vehicle for potential fire hazards regularly.

What if your EV catches fire?

If your EV catches fire, even after taking the best care of it, then you must get yourself and your passengers to safety immediately. Call the fire department once you are safe.

After extinguishing the fire, contact your insurance company and report to them about the incident and raise the claim. The insurance company will send an adjuster who will assess the damage and determine the payout amount.

Fires in EVs remain a serious concern, but you should take all necessary steps to protect yourself. Understand your insurance coverage and take the best care of your EV. This can help you in reducing the risk of financial loss.