What’s a “green vehicle” insurance discount?
In 2019, electric vehicles (or plug-in electric passenger cars) being used totaled over 140,000 vehicles – in Canada alone. It’s no surprise that electric or even hybrid vehicles are extremely popular. Electric vehicles, or EVs, are vehicles designed to use a single or more electric motors to operate. Hybrid vehicles are powered by both an electric motor and an internal combustion engine, and the battery is charged through regenerative braking. Hybrid vehicles and EVs may sound sci-fi, but they’re gaining traction due to their sustainability and environmental benefits.
If you drive one of these vehicles, great! You’re doing your part to “go green.” Not only do these vehicles help you to significantly reduce your carbon footprint, but did you know that they may qualify you for an insurance discount? Some insurers offer a “green vehicle” discount for EVs and hybrids.
Are EVs and hybrids less costly to insure than normal vehicles?
EVs and hybrids are certainly gaining traction in Quebec and Canada, and many insurance providers will reward you with an auto insurance discount for owning one of these vehicles. But are “green vehicles” less costly to insure overall than ordinary gas-powered vehicles?
The short answer is typically no. While emission-free vehicles are in increased demand, they’re not commonplace on public roads and they still cost more to replace – especially electric vehicle batteries – in the event of a collision or other accident. They may even need to go to a special auto shop for repairs. Due to this, it is expected that most EV (and hybrid car) owners will have to pay slightly higher premiums. Some electric vehicles are much more expensive than others, such as certain high-value Tesla models. The premiums for these vehicles is expected to be much higher, but that’s more to do with the expensive parts and/or likelihood of theft for these vehicles, not the fuel source.
Even while you may qualify for an insurance discount by having an EV or a hybrid, it may not offset the increase that comes with the vehicle’s full replacement cost. You may be able to reduce your rates even further by maintaining a clean driving record, driving less, raising your deductible, etc.
What are some other “green discounts” I can qualify for?
The insurance industry wants you to go green, and it’s going to encourage you to do so by offering discounts for a variety of different offerings. The list of green discounts isn’t extensive, but there’s a few things you can do to start. Note that not all insurance providers will offer the same list of premium discounts, so it’s a good idea to consult with your insurance company before making changes.
Going paperless
Going paperless is probably one of the easiest “green discounts” you can qualify for from virtually any insurance provider. Ask your carrier about how you can reduce your premiums by opting out of having your insurance documents mailed and choose to have them sent via email or mobile app instead. This won’t grant you a huge discount, but it’s something – and it saves you from having to keep track of a bunch of loose papers.
LEED-certified homes
An LEED certification is something that can be granted by the Canada Green Building Council, both for residential properties and commercial, if they have been created with eco-friendly materials, are water/energy efficient, etc. Some insurance providers may grant up to a 10% discount for LEED-certified homes. If your home is LEED-certified, discuss with your provider about potential discounts.
Pay-per-kilometer programs
Telematics can be used to gauge driver behaviour, but they can also be used to track the distance you drive and offer premiums discounts to those who driver less kilometers than average. This is because the less that you drive, the less likely you are to be involved in an accident. This will also result in less air pollution with less time on the road.
Alternative fuel
Some insurance providers will reward you if you use an alternative fuel source, including electricity (for EVs and hybrids), but they may also reward you if you use biodiesel, hydrogen, ethanol, or natural gases.
Conclusion
While having an EV or a hybrid vehicle may qualify you for a small premiums discount on your insurance, it may not fully offset the hike in premiums you will end up paying for the total replacement cost of your car. For some lower-value EV or hybrid models, you may not have as high insurance premiums.
There is a short list of other green discounts you can ask your insurance provider about. Not every insurance carrier offers these discounts, so it’s important to discuss with your current company to see what you may qualify for. If you are unsure, call up a Panda7 insurance broker today to chat about green offerings and how you can save money on your premiums.
