The latest figures from comparethemarket reveals that insurance for electric cars is £90 cheaper providing evidence of the financial benefits of greener transportation

Insurance premiums for electric cars are on average £90 cheaper in comparison with petrol or diesel vehicles, according to new figures from ComparetheMarket.

It revealed that the average annual premiums for electric vehicles were £629 over the past year, compared to £718 for petrol and diesel cars.

This cost reduction adds to the savings made on fuel and road tax when switching to an electric car. 

The comparison site highlighted that if a driver were to switch to the cheapest premium for an electric car from a regular vehicle, they could save £191, with the cheapest average premium being £527 lower than that of a petrol or diesel car. 

Dan Hutson, head of motor insurance, ComparetheMarket, said: “Although electric cars represent a small proportion of the total car market, the popularity of greener vehicles is growing at a rapid rate.

“When the technology initially emerged to challenge the status quo, the cost of electric cars acted as a deterrent with prices significantly higher than traditional models.

”However, our data indicates that electric cars bring significant financial as well as environmental benefits, which will be welcome news given the target to phase out new petrol and diesel cars by 2030.

”For those looking to save money or considering buying a new car, switching to an electric car could be an attractive option considering the savings on insurance, fuel and tax.”

Meanwhile, the average insurance cost for electric cars fluctuated over the last 12 months, with the highest being £691 in December 2019 but this dropped to £592 in April 2020.

It follows the government fast-tracking the ban on the sale of new petrol and diesel cars to 2030 – ten years earlier than it previously suggested.

Sales surge

Meanwhile, the latest figures from the Society of Motor Manufacturers and Traders (SMMT) showed that 86, 291 electric cars were registered this year – up from 37, 850 last year.

And more than twice the number of electric battery vehicles have been sold in 2020 in comparison to 2019, compared with less than half the amount of diesel vehicles were sold this year.

November also saw 18, 062 plug-in electric vehicles sold, but only 15, 925 diesel ones – RAC highlighted that this was the first month this has happened.

A spokesperson for RAC data insight, Rod Dennis, said: “The rise in demand for plug-in electrified vehicles appears to partly be taking place at petrol and diesel’s expense, with the latter as a result of concerns over harmful nitrogen dioxide emissions.

“As we move beyond the pandemic, 2021 is set to be a critically important year when it comes to understanding the appetite drivers have for ‘going electric’. With more electric cars coming onto the market, it will be interesting to see if this rise in sales will be sustained or whether the negative economic outlook has the unfortunate effect of quelling demand.”

‘Watershed moment’

The RAC estimated that 185,137 pure electric cars have been registered for use on the UK’s roads since 2010, and 223,384 plug-in hybrid cars.

Whereas diesel car sales dropped during that same period (58%) from 583,488 in 2019 to 246,389 in 2020.

Dennis, continued: “We may well now be reaching a watershed moment when it comes to new car sales in the UK – taking the anomalous month of April aside when dealers were forced to shut because of the pandemic, November saw more plug-in cars registered than diesel cars.”

But he pointed out that the number of electric cars on the roads has also meant more breakdowns due to faulty charge points or drivers running out of charge.