WE’VE TALKED A LOT on various podcasts and in our own articles about the surprisingly high costs of insuring an electric vehicle, compared to insuring a similar internal combustion engine car. This has elicited a number of enquiries from our readers about the relative costs of insuring a plug-in hybrid vehicle.
A recent survey conducted on behalf of Youi insurance comes up with intriguing details.
In an unexpected outcome, the survey shows that hybrids are not only cheaper to insure than EVs, in many cases they are cheaper to insure than ICE vehicles.
That’s unexpected because hybrids not only have a combustion engine but also a battery (although usually much smaller than other EVs).
“When looking at the difference in overall average pricing, we see this difference is more about the mix of customers that choose a hybrid vehicle compared to a petrol vehicle, their age, driving experience, location etc,” explained Marni Jackson, Youi’s head of product for vehicles including cars and motorcycles.
“We find younger drivers (under 25) are more likely to have a petrol vehicle compared to a hybrid vehicle.”
Of course, the workings of an insurance company are very much a dark art, and the factors affecting the differing premiums are many and varied, including your driving history, and where you drive.
2022 to 2024 median premiums
Vehicle price EV ICE Hybrid
$37,501 to $50,000 $1125 $1153 $1103
$50,001 to $75,000 $1887 $1393 $1219
$75,001 and above $1837 $1703 $1670
During 2022 and 2023, there wasn’t a significant variation in median premiums between the three categories for vehicles below the $50,000 threshold.
In fact, the median premium is actually lower for EVs than ICE vehicles across all three years (2022, 2023, 2024) included in the survey).
Higher price brackets, however, show the median premium for EVs is considerably higher than for ICE or Hybrid vehicles.
2022
Vehicle price EV ICE Hybrid
$37,501 to $50,000 $1099 $1198 $1099
$50,001 to $75,000 $1759 $1425 $1304
$75,001 and above $1847 $1754 $1822
2023
Vehicle price EV ICE Hybrid
$37,501 to $50,000 $1127 $1155 $1123
$50,001 to $75,000 $1831 $1386 $1243
$75,001 and above $1792 $1698 $1647
2024
Vehicle price EV ICE Hybrid
$37,501 to $50,000 $1125 $1153 $1086
$50,001 to $75,000 $2015 $1378 $1169
$75,001 and above $1937 $1669 $1522
“There are a few reasons why an EV may be more expensive to insure. These reasons are primarily centred around a higher repair cost, and the cost of skilled labour for EVs (with high demand and low supply),” said Ms Jackson.
“The repair network is still in its early stages of getting established, there are fewer EV repairers available, which can increase the time it takes to get an EV repaired, subsequently increasing secondary costs, like hire car.
“EVs are also more likely to be built with more advanced technology, the location of the battery is different compared to an ICE with a front engine, and there are differences in suspension and materials used.”
It’s worth noting combustion-powered vehicles accounted for more of the quotes. Above is a breakdown, looking at combined quotes for model years 2022, 2023 and 2024.
Another interesting detail that came out of the survey is the comparison between the requests for insurance quotes for ICE vehicles, EVs and Hybrids. The gulf in the number of quotes between ICE vehicles and EVs and hybrids corresponds with the significantly larger market share ICE vehicles have.
In 2023, petrol and diesel vehicles combined accounted for just under 80 percent of all new car sales in Australia.
Hybrids accounted for eight percent of the market, EVs just over seven percent of the market, and plug-in hybrids for just under one percent.