EVs, hybrids and plug-in hybrids can be seen frequently on American roads. While car insurance for a “green” car can be a bit more expensive than a gas-powered vehicle, the difference is not as big as you may think.
In the spring of 2023, CarInsurance.com surveyed drivers nationwide, asking them about their thoughts on electric vehicles, car insurance, inflation, the best state Departments of Motor Vehicles and more. In the survey, 21% of drivers said they are considering the purchase of an EV.
Furthermore, drivers said that not having to pay for gas was the biggest reason they’re considering an EV purchase — to the tune of 40%. Other reasons? Climate change anxiety is the reason 27% of drivers would buy an EV with 19% saying that lower maintenance costs could induce them to purchase an electric car.
If you’re interested in learning how to get cheap insurance with an EV, keep reading.
- Electric vehicles and hybrids are typically more expensive to insure than gas-powered vehicles.
- EVs and hybrids come with higher sticker prices, are more expensive to repair and have a big expensive battery under the hood.
- Insurance rates vary dramatically between insurers for electric vehicles and hybrids, so it pays to shop for coverage regularly.
- How much does car insurance cost for a hybrid?
- What’s the most affordable car insurance for an electric car?
- Car insurance rates for green vs. gas-powered vehicles
- What are the cheapest companies for green vehicles?
- Which discounts are available for hybrids and electric cars?
- FAQ: The cheapest hybrids and EVs to insure
- Final thoughts on insurance for EVs and hybrids
- Resources & Methodology
How much does car insurance cost for a hybrid?
A hybrid is a vehicle that has both a gasoline engine as well as an electric motor. Hybrids operate as electric vehicles under certain conditions and the gas-powered motor kicks in when necessary. The Toyota Prius is probably the best-known example of a hybrid, but there are now many hybrids to choose from, and most automakers have at least a few hybrids in their lineup.
Like internal combustion vehicles, the cost to insure a hybrid can vary dramatically depending on the car. Insurers consider various factors, including the price of the vehicle, repair costs, safety features and personal risk factors.
Hybrids are often more expensive to insure than their internal combustion counterparts due to the higher sticker price and the fact that they usually cost more to repair.
A hybrid has a gas engine and a small electric motor, pushing the sticker price and repair costs. In addition, hybrids have a battery to power the electric motor, which is expensive to replace or repair. All of these factors lead to more expensive car insurance.
When we ran the numbers, insurance rates for a hybrid ranged from $1,442 for a Jeep Wrangler to $3,922 for an Audi RS6 Avant Quattro.
Here are the top five cheapest hybrids to insurance and the annual premium based on our data:
- Jeep Wrangler: $1,442
- Honda CR-V: $1,449
- Ford Escape: $1,487
- Kia Niro: $1,526
- Toyota Venza: $1,569
What’s the most affordable car insurance for an electric car?
The cheapest EVs to insure are smaller, compact vehicles with a reasonably low (for an EV) starting price. Compact cars are cheaper to insure regardless of whether the engine under the hood runs on electricity or gas.
The cheapest electric vehicle to insure was the Mini Cooper SE, with an annual premium of $1,479. The Mini comes with a very affordable starting price (for an EV) of $34,225, a compact size and affordable repair costs, which means cheaper car insurance.
The second cheapest EV to insure is the Hyundai Kona, with an annual premium of $1,507, followed by the Kia Niro at $1,650 and the Chevy Bolt at $1,780. These EVs have a starting price of less than $40,000; the Chevy – the cheapest of the bunch – has a starting price of $25,000.
The Ford F-150 Lightning Lariat rounds out the top five with an annual premium of $1,792. However, this electric truck has an MSRP of around $75,000, making it the most expensive EV of the top five cheapest EVs to insure.
Pickups are cheaper to insure because the vehicle’s back end is simply a bed that can be easily repaired or replaced, making repair costs more affordable. Pickups are often driven by people who live in the country, and rural communities have less traffic and fewer accidents and claims, all of which lead to lower insurance costs.
Car insurance rates for green vs. gas-powered vehicles
Electric vehicles and hybrids cost more to insure than their gas-powered counterparts.
“An electric car’s higher price tag and more complex equipment mean it may cost more to repair or replace if it’s in an accident, ” explains Tim Derham, CEO at Universal Casualty. “In addition, there aren’t as many shops with technicians qualified to fix electric vehicles, which means qualified facilities may charge more for repairs because of the specialized training required.”
How much more you will pay to cover an EV or hybrid will vary depending on the vehicle and personal risk factors.
Here are a couple of examples:
- Gasoline-powered Mitsubishi Outlander: $1,697
- Hybrid Mitsubishi Outlander: $1,890
- Gasoline-powered Toyota RAV4: $1,504
- Hybrid Toyota RAV4: $1,577
What are the cheapest companies for green vehicles?
The best insurance company for a green vehicle will vary dramatically depending on various factors. Insurers use proprietary algorithms to set rates, so premium quotes will differ depending on personal risk factors and the exact green vehicle you insure.
We ran the numbers on many green vehicles, and there were shocking differences in premium quotes for the same vehicle.
Let’s look at the differences in premiums for the least expensive to insure EV and hybrid on our list:
As the numbers clearly show, premiums can vary from insurer to insurer. Allstate charges 79% more than State Farm to insure the Mini Cooper SE.
The difference is even greater with the hybrid. Allstate is still the most expensive insurer, charging 103% more than State Farm to cover a Honda CR-V.
The data clearly show that one of the best ways to lower your insurance premium is to shop your coverage around regularly. Be sure to compare apples to apples regarding coverage levels and deductibles.
Which discounts are available for hybrids and electric cars?
Currently, there are few discounts specific to hybrid or electric vehicles. However, a few insurers offer a green vehicle discount, which can also be called an alternative fuel vehicle discount or a fuel-efficient discount. This discount tends to be pretty small, 5% is common, but every little bit helps.
Check with your insurer whether they offer a discount for environmentally friendly vehicles.
Here are the most common discounts available, regardless of whether your car is electric or not:
- Multi-policy discount, also called bundling
- Good driver discount
- Paperless discount
- Paid in full discount
- Multi-vehicle discount
- Discounts for advanced safety features
FAQ: The cheapest hybrids and EVs to insure
Can I still get a tax credit if I buy an EV?
Yes, many federal and state tax credits exist for drivers who purchase an EV. The credit will vary by state and the electric vehicle you buy. Tax credits can be significant, so be sure to chase down every credit you can receive – the federal credit is currently $7,500 for certain EVs.
However, there have been changes to the rules since the passage of the Inflation Reduction Act.
“In order to receive the full tax credit of $7,500, the law states that 40% of the critical minerals in EV batteries must be sourced from countries with which the United States has a free trade agreement, explains Nadia Bical, vice president at Bical Auto Mall in New York. “In addition, starting in 2023, 50% of components will have to be manufactured or assembled in North America.”
Check the Alternative Fuels Data Center for information regarding state and federal tax credits for EVs, hybrids and other alternative fuel vehicles.
What are the benefits of buying an electric vehicle or hybrid?
In addition to fighting climate change, green vehicles come with a couple of other benefits you may want to consider: tax incentives and lower fuel costs.
“Green vehicles come with tax incentives offered by federal and state governments as well as long-term savings on fuel and maintenance, ” says Derham. “Green vehicles have fewer moving parts and often break down less often which reduces or eliminates fuel costs. Both of these benefits can help offset higher insurance rates.”
What are the most expensive EVs and hybrids to insure?
High-end electric sports cars cost the most. The Audi RS E-Tron GT costs $4,150 a year to insure. The Tesla Model S Plaid isn’t much cheaper, costing $ 4,115 to insure.
The top five comprise the Porsche Taycan Turbo and two other Teslas.
The Audi RS6 Avant Quattro is the most expensive hybrid to insure at $3,922 per year on average, followed by the Porsche Panamera at $3,855 per year, Acura NSX Type S ($3,626), and two Audi Quattro models.
Final thoughts on insurance for EVs and hybrids
The number of green vehicles on the road increases as more drivers switch to electric cars or hybrids. While insuring a green vehicle can be a bit more expensive than a gas-powered vehicle due to higher sticker prices and repair costs, the difference is not always budget-busting.
While it will vary by vehicle and risk factors, insuring a green vehicle can cost slightly more than a gas-powered vehicle. The data show how important it is to shop your coverage around regularly, particularly if you drive a green car. Some insurers charge double the rates offered by their competitors.
Resources & Methodology
EERE. “Alternative Fuels Data Center.” Accessed January 2023.
CarInsurance.com commissioned Quadrant Information Services to pull rates in 2022 for a 40-year-old single male driver with full coverage (100/300/50 and a $500 deductible) and a good driving record. CarInsurance.com commissioned survey company Slice to survey drivers nationwide in 2023 about their driving habits, favorite driving songs, the best roads and DMVs, inflation and attitudes about car insurance. The survey was conducted March 24 – April 4, 2023. There were 2,300 respondents.