From Gas Savings to Insurance Costs: The Real Economics of Switching to an EV
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Are you thinking about trading in your gas car for an electric vehicle (EV)? Although the fuel savings on your EV can be enticing, there’s much more to the economics of making the switch.
Key Takeaways
1. EV charging costs 66% to 70% less than gasoline across the vehicle categories studied in 2026.
2. EV maintenance costs are about 50% lower than gasoline vehicles because EVs don't require oil changes and have fewer moving parts.
3. EVs may have higher insurance costs due to expensive repairs and battery-related replacement costs.
4. Your lifestyle, driving record, vehicle, insurance policy, and deductible are among the major factors that influence your auto insurance premium.
EV insurance is likely to cost more money than gasoline cars, although there are exceptions. EVs cost 30% more to repair than petrol or diesel models, and they take 14% longer to fix.
The NAIC says higher EV insurance premiums stem from the car’s cost, specialized repairs, and replacing batteries and parts.
Always compare quotes for actual vehicles instead of using a single percentage.
| Factor | Its influence on premium |
|---|---|
| Value of the car | The higher the car's value, the more you pay for claims. |
| Complexity of repairs | Specialized EV parts can make repairs costly. |
| Battery | Insurers may consider battery repair or replacement. |
| Driving history | The driver's history can affect prices. |
| State, location, insurance coverage | These factors determine the price of the insurance policy. |
Yes and no; it depends on each particular car and driver.
According to a study, battery electric cars offered about $860 per year in running cost savings compared to gasoline cars.
But fueling is not the only cost of owning a car. EVs have the lowest fuel costs among the cars considered; however, depreciation, fees, and finance charges might outweigh those savings.
For instance, medium-sedan EVs had 29.1% higher ownership costs in the comparison.
First, compare quotes with the same level of coverage and deductibles.
Also, a good driving history, checking the discounts you qualify for, and choosing a car that isn’t too expensive to repair will affect the final cost.
It is important to look at insurance alongside gas, maintenance, depreciation, and financing.
EVs help you save money not only on fuel and service but also offer a new car-ownership experience. However, you must consider the full picture and estimate insurance, charging, maintenance, depreciation, and financing costs.
Calculate the annual costs of the EVs and gas models you plan to buy. Also receive the insurance quote and estimate the costs of your usual driving and charging.
Want to switch to EV? Check the possible options, receive the insurance quote, and start saving money with an EV.
The cost of insurance differs by state, drivers, car, and level of coverage. The difference varies from state to state, but the actual gap between premiums in terms of dollar amount can be very different.
Not necessarily. Lower fuel and maintenance costs can balance out the insurance costs; however, other costs like depreciation and financing may further impact the total cost.
It is important to calculate the entire five-year ownership costs, including purchase price, financing, insurance, charging, maintenance, and resale price. These factors should be considered when calculating the cost of ownership.
Paige Cerulli Paige Cerulli is a freelance content writer and journalist who specializes in personal finance topics. She graduated from Westfield State University and brings more than a decade of professional writing experience to the ConsumerCoverage team. Paige’s work has appeared in outlets including USA Today, Business Insider, and more.
