Electric Vehicle Insurance Soars 16-Fold, Signaling India's Green Shift

Electric vehicle insurance demand has surged 16 times in three years, with Policybazaar reporting a growth from 0.50% to 14% in EV car insurance share by 2025. Most adoption is in metro cities, with comprehensive coverage gaining popularity. Electric scooters dominate the two-wheeler segment.

The demand for electric vehicle (EV) insurance has skyrocketed, experiencing an astonishing 16-fold increase over just three years, according to internal data from Policybazaar. The share of EV insurance policies rose dramatically from a mere 0.50% in FY23 to 14% by March 2025, accounting for 8.2% of the market.

Speaking on these evolving trends, Amit Chhabra, CBO of General Insurance at Policybazaar, remarked, "The swift uptake of EV insurance highlights India's shift toward sustainable mobility. With EV insurance share expanding 16 times in three years, consumers are not only adopting electric vehicles but also understanding the need for customized protection." The company's data indicates a notable increase in two-wheeler EV insurance, now comprising 7-8% of policies for this category under five years of age.

Policybazaar's data also reveals a doubling in the number of EV insurance policies over the past year, from 10,000 to 20,000. Electric scooters dominate the segment, representing 98-99% of insured two-wheelers. The surge is concentrated in top metro cities like Delhi-NCR, Bangalore, Pune, Chennai, and Mumbai-Thane, making up 55% of all EV insurance purchases.

Tier 1 cities lead the charge, capturing 58% of EV insurance policies, while tier 2 and 3 cities make up 30% and 12%, respectively. Consumers are increasingly selecting comprehensive coverage, including popular add-ons like Zero Depreciation, Roadside Assistance, and Battery Cover.

Among two-wheeler EVs, tailored add-ons such as Battery Protector and Charger Cover are designed specifically for electric vehicles, in addition to common options like Zero Depreciation and Roadside Assistance.

(With inputs from agencies.)