Electric vehicles are becoming an increasingly common feature of UK business fleets and company car schemes. However, as more organisations make the transition to electric vehicles, insurers are paying closer attention to the cost and complexity of EV-related claims.

While EVs can offer environmental benefits and lower day-to-day running costs, repairing them can be more expensive and time-consuming than repairing equivalent petrol or diesel vehicles. These factors are beginning to influence how insurers assess, price and manage electric vehicle risks.

EV adoption continues to grow

The UK’s transition towards net zero, continued investment in charging infrastructure and tax incentives for electric company cars have all supported the growth of electric vehicles.

Government figures show that EV adoption continues to increase as electric models become more widely available and the cost difference between electric, petrol and diesel vehicles gradually narrows.[1]

For businesses, moving to electric vehicles can support sustainability targets and potentially reduce fuel and maintenance costs. However, the insurance implications should also form part of the decision-making process.

Why can EV insurance claims cost more?

Insurers are monitoring several factors that may increase the cost and severity of electric vehicle claims.[2]

Complex repairs and specialist safety requirements

Electric vehicles contain high-voltage battery systems, electrical components and technology that may require specialist assessment and repair procedures.

When an EV is damaged, technicians may need to follow additional safety measures before work can begin. Repairs may also require specialist equipment and facilities that are not available at every garage.

Expensive battery components

The battery is typically one of the most valuable components of an electric vehicle.

Battery damage may not always be immediately visible following an accident. Further inspection may be required to determine whether the battery can be safely repaired, replaced or reused.

Because replacement batteries can be expensive, relatively limited damage may significantly increase the overall cost of a claim. In some cases, an insurer may decide that writing off the vehicle is more economical than repairing it.

Lithium-ion batteries may also require additional handling and safety precautions following an accident, particularly where the extent of the damage is unclear.

A shortage of qualified EV technicians

Electric vehicle repairs require specific skills, qualifications and equipment. However, the number of technicians trained to work safely on EVs has not always kept pace with the number of electric vehicles entering the market.[2a]

A limited network of qualified repairers can increase labour costs and make it harder to arrange repairs quickly.

Longer repair times

Specialist assessments, safety procedures and limited repair capacity can result in electric vehicles remaining off the road for longer.

For fleet operators, extended repair times can create additional disruption, reduce vehicle availability and increase the cost of temporary replacement vehicles.

Parts and supply chain delays

Electric vehicle technology is developing quickly, and some replacement parts can be difficult to source.

Delays in obtaining batteries, electrical components or model-specific parts may extend repair times and increase the overall cost of a claim.[2b]

These pressures mean that EV claims may cost more, even where the vehicle’s routine running costs are lower.

What does this mean for insurance premiums?

Motor insurers are already managing rising repair, labour and replacement vehicle costs across the wider motor insurance market.[3]

As electric vehicle adoption increases, insurers are incorporating EV claims experience into their underwriting and pricing models.

Depending on the vehicles, fleet profile and claims history, businesses may experience:

• Higher insurance premiums

• Greater scrutiny of particular EV makes and models

• More detailed questions about repair and maintenance arrangements

• Increased focus on claims management and fleet risk controls

• Differences in appetite between insurers

As the EV repair network develops and insurers gather more claims data, pricing may become more consistent. However, some volatility is likely to remain in the short to medium term.

What should businesses review?

Moving to an electric fleet is not only an environmental or operational decision. It is also an insurance and risk management consideration.

Businesses introducing electric vehicles may wish to review the following areas.

Motor fleet cover and limits

Higher vehicle values and repair costs may affect whether existing policy limits remain appropriate.

Businesses should also check whether the policy contains any specific requirements or restrictions relating to electric vehicles, batteries or charging equipment.

Vehicle downtime

Longer repair times may increase the financial impact of vehicles being unavailable.

Businesses should consider how extended downtime would affect operations and whether suitable replacement vehicles would be readily available.

Claims management

Access to an approved EV repair network may help reduce delays and ensure that damaged vehicles are assessed by appropriately qualified technicians.

Clear internal claims reporting procedures may also help repairs begin sooner.

Insurer appetite

Not all insurers approach electric vehicle fleets in the same way. Some may have greater experience or a stronger appetite for particular vehicle types, industries or fleet profiles.

The insurer that previously offered the most suitable terms for a petrol or diesel fleet may not necessarily provide the best option for an EV-heavy fleet.

Hire and replacement vehicle costs

Long repair times can increase temporary hire, replacement vehicle and credit hire costs.

Businesses should review the level of replacement vehicle cover available and consider whether it reflects their operational needs.

Cover will depend on the individual policy terms, conditions, exclusions and limits.

Why does this matter now?

Many organisations are adopting electric vehicles faster than the insurance and repair markets are developing.

This can create a gap between the operational reality of rapid EV adoption and the insurance market’s developing understanding of long-term claims performance.

Fleet operators may therefore need to place greater emphasis on:

• Driver training

• Accident prevention

• Vehicle security

• Charging safety

• Claims reporting

• Repair arrangements

• Business continuity planning

A well-managed electric fleet may also help demonstrate to insurers that the business is actively identifying and controlling its risks.

Speak to your insurance broker

If electric vehicles already form part of your fleet, or you are considering introducing them, it may be time to review your insurance arrangements.

Your broker can help you:

• Understand how EV adoption could affect insurance costs

• Review your fleet’s claims trends and emerging exposures

• Consider whether your cover remains suitable for your demands and needs

• Compare insurer appetite for electric vehicle fleets

• Review replacement vehicle and loss of use arrangements

• Identify risk management measures that may support insurer discussions

Reviewing your arrangements before making significant changes to your fleet can help you understand potential insurance costs, cover limitations and operational risks.

Speak to Routen Chaplin to discuss how changes to your fleet may affect your insurance requirements.

Sources

[1] UK Government, Electric vehicles: costs, charging and infrastructure
https://www.gov.uk/government/publications/electric-vehicles-costs-charging-and-infrastructure/electric-vehicles-costs-charging-and-infrastructure

[2] UK Government, Motor Insurance Taskforce Final Report
https://assets.publishing.service.gov.uk/media/6954d41b6a4ea67a402a835c/motor-insurance-taskforce-final-report.pdf

[2a] Thatcham Research, Critical skills shortage in the UK vehicle repair sector
https://www.thatcham.org/thatcham-research-reports-critical-skills-shortage-in-uk-vehicle-repair-sector/

[2b] ATF Professional, Repair delays and vehicle parts shortages
https://atfpro.co.uk/2025/05/28/repair-delays-and-vehicle-parts-shortages/

[3] WTW, UK motor insurance rollercoaster: is 2025 simply momentary relief?
https://www.wtwco.com/en-gb/insights/2026/05/uk-motor-insurance-rollercoaster-is-2025-simply-momentary-relief

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