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The 21st Century welcomed the arrival of practical electric vehicles to the car marketplace in North America. Along with the rise of the hybrid vehicle class, green cars continue to gain popularity and market position. Tesla’s next model, due in 2017, targets a price under $50,000, opening EV technology to greater numbers of drivers.

What is an Electric Vehicle?

These are cars that use stored energy in batteries to provide motion. True EVs have no fuel burning engine. A car with both gas engine and electric propulsion systems are called hybrids. The Nissan Leaf, Tesla, and Chevrolet Volt lead the EV lineup in popularity in North America.

EVs have electric motors turning wheels, powered by rechargeable batteries. The operation is much quieter than with internal combustion engines which of course operate through a series of controlled explosions, thousands of times per minute. Without taking the origins of the energy used to charge the batteries, EVs are much cleaner and environmentally friendly.

Acceleration can be surprisingly powerful, particularly when paired with quiet operation. Tesla’s main vehicle, the Model S, goes from zero to 100 kilometers per hour in under 3 seconds. Without the gas engine noise, the acceleration has a surreal feel. This is a characteristic that might, in the long run, negatively affect insurance prices, since high performance attributes typically raise a vehicle’s risk factors. To date, though, it hasn’t been an issue in Canada.

How do EVs affect auto insurance prices?

electric car charging


Though capable of great performance and coming in with high price tags, it’s early in the EV game and insurance trends aren’t firmly established. Usually, a lack of information causes insurers to assess greater risk. This hasn’t been the case of late with EVs in Canada. In fact, many insurers offer green vehicle discounts. Part of this may be an attempt to gain niche market share, but there does seem to be a trend connecting EVs with safe driver demographics.

Though EVs have been part of the mainstream for only about five years, insurers offered green discounts through most of this period. Be aware that not all insurers may offer such discounts. Even in tightly regulated insurance markets, such as that in Ontario, private insurers have the freedom to develop and implement their own, unique plans and policies, as long as they receive provincial approval.

This means that not only does an insurer decide if they will offer green discounts, insurance companies also decide how they view EVs from an insurance risk standpoint. For example, a smaller and more conservative insurer might decide that the unknowns of EV risks prevent them from comfortably supporting that market. A larger and more progressive company could see the EV market as an opportunity. Each company targets its marketing with its strategic intentions.

Finding the lowest rates on an EV means shopping through as many companies as possible to find the most green-friendly coverage. Try the Quote Finder car insurance calculator, available from the drop-down menu at the top of the page. It could provide an electrifyingly low insurance quote.

About the Author: Robert Davis

He is an insurance content professional with vast knowledge and a special aptitude and interest in imparting insurance education. He has authored many articles on insurance.

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