EV Insurance Premiums vs Gas Cars: What to Expect in 2025

As electric vehicles (EVs) continue to rise in popularity, more drivers are asking a key question: how do insurance costs compare to gas-powered cars? In 2025, with EV adoption accelerating and new data available to insurers, the landscape is shifting. This guide will walk you through what to expect in terms of pricing, risk, and coverage differences between EVs and traditional gas cars.

A futuristic car is on display in a building

Whether you’re buying your first Tesla or trading in a sedan for a Chevy Bolt EUV, here’s what you need to know.

Do EVs Cost More to Insure?

Yes — but not always.

EVs typically have higher insurance premiums than their gas counterparts, though the gap is narrowing. This is due to:

Higher vehicle value
Expensive batteries and repairs
Limited availability of EV-certified repair shops
Longer repair times

However, federal incentives, driver discounts, and lower maintenance risks can offset some of these costs.

Average Premiums in 2025

Vehicle Type	Average Annual Premium
Electric Car	$1,850–$2,300
Gas-Powered Car	$1,300–$1,700
Hybrid	$1,500–$1,900

These numbers vary based on model, location, age, driving record, and insurance provider.

Why Are EVs More Expensive to Insure?

🔋 Battery Replacement Costs

Batteries can cost $7,000–$20,000, and any structural battery damage usually means a total loss.

🛠️ Specialized Repairs

EVs often require manufacturer-authorized or EV-certified mechanics. Labor rates are higher, and parts are less available than for combustion engines.

🧰 Tech-Heavy Components

EVs come loaded with sensors, cameras, and ADAS (Advanced Driver Assistance Systems), all of which are costly to fix or calibrate after an accident.

When EV Insurance Is Cheaper

Some scenarios can bring EV premiums below gas cars, including:

Low-mileage urban drivers
Telematics-based policies
Eligibility for EV-specific discounts
High safety ratings on certain EVs

Insurers like Tesla Insurance, Nationwide, and Progressive are pioneering lower rates for safe EV drivers based on real-world driving data.

2025 Discount Programs to Know

Program Type	Example Benefits
EV Owner Discounts	Up to 10% off for fully electric drivers
Usage-Based Insurance	Up to 30% off based on low mileage
Green Vehicle Discounts	5–10% for eco-friendly policies
Bundling with Home EV Charger Insurance	Extra savings available

Pros and Cons of EV Insurance in 2025

Pros	Cons
✅ Lower maintenance risks	❌ Higher repair costs for batteries and tech
✅ Eco and tech-savvy driver discounts	❌ Fewer mechanics and longer repair delays
✅ Usage-based and Tesla-specific programs	❌ Not all insurers fully understand EV risks yet
✅ Incentives for bundling EV & home coverage	❌ Premiums still often higher than gas vehicles

Best Insurance Companies for EVs in 2025

Provider	EV Coverage Highlights
Tesla Insurance	Real-time tracking, tailored for Tesla drivers
Progressive	Green vehicle discounts, usage-based plans
Liberty Mutual	Certified EV repair shop network
State Farm	Custom equipment coverage for chargers & converters
GEICO	Moderate rates; good for entry-level EVs

FAQs

Q1: Are EVs harder to insure in rural areas?

Yes. Insurers may charge more in regions without EV-certified repair centers due to longer tow distances and repair delays.

Q2: Will my home charger be covered by my car insurance?

Not automatically. You’ll need a homeowner’s rider or equipment protection add-on to cover wall chargers and installation.

Q3: Do EVs qualify for usage-based insurance?

Absolutely. EVs are ideal for usage-based programs due to frequent short-range driving. These programs can lead to steep discounts if you drive less than 7,500 miles per year.