7 things to consider before buying an electric vehicle
- In Australia 8.4% of cars sold from January to June 2023 were electric
- Charging capability and infrastructure is a key consideration
- Look for an insurer that has expertise in insuring electric vehicles
Across the world, the take-up of electric vehicles (EVs) is increasing. In Australia, the popularity of EVs is also growing, albeit at a slower rate than the global average.
In the year to June 2023, 8.4% of vehicles sold in Australia were electric, which is more than double the 3.8% sold in the year to June 2022.1
However, it’s still significantly less than the rest of the world. In fact, research found that in 2023, EV buying intent in Australia was 37%, below the global average of 54%, the lowest of the 20 countries surveyed.2
Popular electric vehicles in Australia
Electric vehicle popularity is increasing, and when it comes to choosing an EV, the Australian market is dominated by just three models – Tesla Model Y, Tesla Model 3, and BYD Atto 3, which together account for 68% of EVs sold in Australia.3
In total, as of June 2023, there were 91 EV models available here, but the majority are only supplied in small volumes, as Australia doesn’t yet have a New Vehicle Efficiency Standard to ensure manufacturers increase the supply of EVs.4 That’s in the works.
It’s likely the popularity of EVs will continue to grow over the coming years, so if you’re considering getting an EV now or in the future, here’s seven things you need to know.
1. EV home charging station installation
For anyone owning an EV, being able to charge your vehicle at home is likely to be important. While this may be fine if you live in a home with a garage or off-street parking, it will be less achievable if you live in the busy inner-city with on-street parking.
That said, a startup in Melbourne is offering retractable, personal kerbside charging units for EVs in Victoria,5 so that may not be as much of a problem in the future.
If you’re currently looking to buy an apartment in a strata, the availability of EV chargers – or plans to install shared chargers – is worth checking out.
2. Power supply for home EV charging stations
Most homes in Australia will have a one-phase electricity supply, however, larger homes and commercial buildings may have three-phase electricity.6 This determines how much electricity you can draw at any one time.
A one-phase system is generally fine for everyday home electricity use, however, it may not recharge your EV very quickly. A 1.8kW AC home plug, for example, will take up to 29 hours to charge some models.7
Certain EV models will charge faster on a three-phase system,8 so it’s a big consideration if you’re installing a charger or looking to buy a new property.
3. Installing a home EV charging system safely
Lithium-ion batteries can be a fire hazard if not handled and installed correctly.9 That’s why it’s important to choose an approved EV charger and ensure it’s installed by a licensed electrician.10
EV chargers are generally suitable for indoor or outdoor installation,11 costing between $1,000-$3,000 for a Level 2 22kW fast charger, plus installation costs.12
Chargers must be installed according to the manufacturer’s guidelines, ensuring adequate ventilation, while the charging cable shouldn’t create a trip hazard.
4. Public EV charging stations
Whether you’re planning to install a home charger or not, it’s a good idea to be familiar with the local charging network – and what plans there are for the future.
Across Australia, the government is investing in EV chargers, with a year-on-year increase of 57% in high-power charging locations.13 Plus, a number of public fast charging stations are being funded by state and territory governments.14
5. EV car insurance – things to consider
While insurance for your regular petrol/diesel and electric vehicles has many things in common, insurers are keeping a close eye on EVs – and how people are using them – to evaluate the unique risks electric vehicles present.15
“Insurers need to consider factors such as battery replacement costs, specialised repair requirements, and the evolving technology in electric vehicles,” says Rod McDougall, Head of Short Tail Claims Supply Strategy at QBE.
“Meanwhile, the higher repair and maintenance costs associated with EVs also need to be considered. This may include coverage for specialised technicians and the use of original manufacturer parts, which can be more expensive.”
With the take-up of EVs greater in other parts of the world, the Australian insurance market is keeping a keen eye on emerging global trends.
“Overseas data suggests that repair costs for EVs can be higher due to the specialised nature of electric vehicle components, including batteries and the electric drivetrain,” says Silvio Necco, Head of Motor Assessing and Supply Chain at QBE.
“This may impact claims amounts and the need for insurers to cover or negotiate costs for these specialised parts.
“Unlike traditional petrol/diesel vehicles, EVs rely heavily on complex software and electronic components. Overseas experiences indicate that claims may involve issues related to software malfunctions, updates, or failures, requiring a different approach to claims assessment and processing.”
6. EV insurance checklist
Here are some key points to consider when thinking about insurance for your electric vehicle.
EV battery coverage
The cost of replacing EV batteries is a key factor influencing insurance premiums. As battery technology evolves, insurers may need to account for the expense of replacing or repairing them if they get damaged.16
EV repair network
EVs often have different structures and components compared to petrol/diesel cars, so it’s important to be aware of potential repair costs for specialised EV components, and ensure insurance adequately covers these expenses.
Your insurer should have repairers within its authorised network with the skills to repair electric vehicles.
“QBE’s Accredited Smash Repairer Network is strong, however as the landscape changes, repairers need to keep up with advancements in EV technology,” says McDougall.
“Continuous training is essential to stay current with the latest developments in electric vehicle systems. Certification programs and training courses specific to EVs can provide valuable expertise for professionals in this field.”
EV charging equipment coverage
Check your policy to understand if damage or loss of EV charging equipment is covered. By using certified equipment, installing charging equipment properly and maintaining it regularly, risks can be minimised.
Insurer’s EV expertise
It’s best to do your research and check EV coverage before insuring your electric vehicle. Check with your insurer to see if the repairers in their network have the expertise to repair your car, if you were to make a claim.
Usage patterns and mileage
As with petrol/diesel car insurance, it’s important to communicate your typical usage patterns and mileage to your insurer.
Government EV incentives and discounts
When researching EVs and insurance, it’s good to understand any government discounts or incentives that may be available, which could impact purchase price and insurance.
“The insurance sector is also keeping a close eye on government policies and incentives related to EV adoption,” says McDougall.
“Changes in regulations, subsidies, or incentives for EV owners may influence insurance and pricing.”
7. Getting EV ready
Moving from a petrol/diesel car to an EV is a different proposition to switching from one petrol car to another, so it helps to do your homework.
By understanding the differences of owning an EV, you can minimise surprises and have a full appreciation of any related costs.
Like to know how much it will cost to insure your EV? Fill in an online quote form today.
1 Electric Vehicle Council: State of Electric Vehicles – July 2023
2 EY Mobility Consumer Index (MCI) 2023 study
3 Electric Vehicle Council: State of Electric Vehicles – July 2023
4 Electric Vehicle Council: State of Electric Vehicles – July 2023
5 Kerb Charge: Electric Vehicle Charging
6 Australian Financial Review: If I go all electric, do I need to upgrade my grid connection?
7 Which car: How long does it take to charge an electric car?
8 Evolution Australia: What’s the difference between single and three phase power?
9 ACCC: Consumers urged to use and store lithium-ion batteries safely to prevent deadly fires
10 Drive: How much does it cost to install an EV charger at home?
11 EVSE Australia: How to Safely Charge Your Electric Car at Home
12 CarsGuide: Charging Electric Cars at Home – Can You Charge an EV at Your House?
13 Electric Vehicle Council: State of Electric Vehicles – July 2023
14 Green Vehicle Guide: Electric vehicle information
15 Interview held with Rod McDougall and Silvio Necco, QBE, February 2023.
16 Interview held with Rod McDougall and Silvio Necco, QBE, February 2023.
