Monsoon season has arrived. There was recently the news of roof collapse at Delhi Airport which led to damage of vehicles and also one death. Even otherwise, waterlogged roads and basements are a common sight after the heavy rains during the monsoons, posing major risk to vehicles.

Knowing all the risks, it is essential to protect your vehicle through a comprehensive motor insurance cover, especially during the monsoon season. After all, a car is one of the biggest investments one makes during lifetime. With monsoons just having set in, it is the right time to re-evaluate your vehicle insurance, particularly if you own an electric vehicle (EV).

As per NITI Aayog, about 30% of all vehicle sales in India will be EVs by 2030. While the EVs are top-notch examples of modern technology, they come with vulnerabilities, especially during the rainy season. Electric cars and bikes have many electric parts and a high-capacity battery. The parts are extremely sensitive to water damage. In fact, the vehicle may be rendered inoperable by mere water ingress. A small accident or defect can make the vehicle susceptible to water ingress leading to severe damage and expensive repairs.

EV vs. regular motor Insurance

Because EVs face additional risks, it is imperative to have a comprehensive cover. The tricky part is, unlike petrol and diesel vehicles which have well-documented risks, EVs are relatively new to the market and have unknown risks associated with them. Insurers do not have historical data to predict and manage the risks. Over time, they will collect extensive data on the long-term performance of EVs and the associated risks. But while this understanding evolves, they have come up with specialised insurance products to cover EVs. And given the inherent differences between EVs and traditional vehicles, these insurance products also differ. Let’s understand:

Battery coverage: The primary distinction between EVs and internal combustion engine (ICE) vehicles lies in power source: EVs use batteries instead of fuel. So, EV insurance focuses more on battery coverage. Given EV batteries can constitute 40- 60% of the vehicle cost, policies includes protection against battery degradation and damage, reflecting the high replacement costs involved. It is also recommended to get the Battery Protection Add-on which fully covers battery for damage due to water ingress, power surge or mishap.

Charging equipment cover: A critical part related to EVs is the charging equipment that comes with it. These may include charging cables, home charging stations, and other accessories. Most insurers provide add-on covering equipment against damage — which is a possibility during monsoons. The policies also cover these against theft.

Roadside Assistance: Many EV policies come with enhanced roadside assistance. After all, the vehicle may unexpectedly run out of charge. Given the EV charging station network is not yet as extensive as the petrol pump network, having a policy that includes towing services to the nearest charging station can be a lifesaver.

Cost factor: EV vehicles generally have a wider range of risks and higher repair costs due to advanced electrical components. For instance, the motor in an EV can cost anywhere between ₹20,000 and ₹1,00,000 depending on the model. The labour costs are also higher. Therefore, it is highly recommended to purchase insurance covering against the high costs associated in case of any damage.

EV insurance premiums generally exceed those for petrol and diesel vehicles. However, the good news is the Insurance Regulatory and Development Authority of India (IRDAI) has taken cognizance of this and has mandated a 15% discount on third-party premiums for EVs. While the idea behind this is to promote the adoption of green mobility, it has also made EV premiums a little more affordable by balancing out some of the higher costs associated with comprehensive EV insurance.

While buying an EV cover, it is a good idea to mull Zero Depreciation Cover to get full claim amount without deduction for depreciation. (The writer is Head, Motor Insurance, Policybazaar.com)