With electric vehicle (EV) sales in Australia slowing, new research from Money.com.au reveals nearly a quarter of Australians (23%) believe car insurers should offer additional discounts or incentives to EV drivers to help boost uptake.
Nearly a third of Aussies (31%) only support this if it’s backed by data showing EVs are cheaper to repair or pose a lower accident risk. For example, EVs may have better responsiveness than petrol engine cars to prevent collisions.
Meanwhile, nearly half of Australians (46%) oppose EV insurance discounts and argue that they are already subsidised enough through government incentives, such as Fringe Benefits Tax (FBT) exemptions on eligible models and state-based rebates.
Based on sales trends over the past four years, battery electric vehicle (BEV) sales are projected to reach 126,279 units in 2025 — a 38.3% year-on-year increase. If current growth trends continue, BEV sales could double to 264,256 units by 2030, although growth is expected to slow to a compound annual growth rate of 15.9%.
Money.com.au finance expert Sean Callery, says Aussies are split between supporting discounts for green technology to accelerate EV adoption and wanting a level playing field when it comes to insurance pricing.
“We know from various studies that EVs are generally more expensive to insure, but many Aussies still don’t believe insurers should hand out discounts just for driving one, unless clear data shows they pose a lower risk, ” he says.
“While insurance costs for EVs are still higher today, they are generally offset by savings on running costs and the growing availability of cheaper finance options through green loans.
As competition increases and EV prices continue to fall, the overall cost of owning an electric vehicle should become more accessible to more Australians.”
Electric cars are more expensive to insure than petrol or diesel vehicles because they cost more to buy, repair, and replace. However, some insurers offer discounts to EV owners who limit their annual mileage to 15,000km — a benefit that is also available to other drivers.
Younger Aussies say yes, older generations say no
Younger generations, such as Millennials (27%) and Gen Z (26%), are the most likely to support offering insurance discounts to EV drivers to boost uptake.
In contrast, older generations — namely Baby Boomers (57%) and Gen X (49%) — are the most likely to oppose EV insurance discounts, and say EVs are already subsidised enough by governments.
Based in New York, Stephen Freeman is a Senior Editor at Trending Insurance News. Previously he has worked for Forbes and The Huffington Post. Steven is a graduate of Risk Management at the University of New York.