Electric mobility and its insurance on the rise

Electric cars sales are growing in the Czech Republic. Despite the coronavirus crisis, it had more than tripled year-on-year to 1,888 vehicles sold in the first ten months of the year. DEFEND INSURANCE GROUP has predicted this trend and has been offering DEFEND Gap insurance for alternative fuel cars for more than 2 years. Currently it focuses on extended warranties for these types of vehicles.

The reduction of our carbon footprint is one of the most important global topics. Car manufacturers more than ever before are coming up with electric versions of their models, and Czech car manufacturer Škoda is not an exception. Škoda offers the best-selling electric car in Czech Republic, the Citigo-e iV. In the first ten months of this year, 732 units of this model were sold. In second place was American car manufacturer Tesla, with 357 electric vehicles sold, and coming in third, South Korean car manufacturer Hyundai, with 291 electric cars sold.

A lot is expected from the brand new Volkswagen’s model ID.3. In addition to emission-free mobility that boasts environmental friendliness, the main advantages of electric cars are low operating costs. According to ČEZ, you will pay less than 1p for 1 km driven in an electric vehicle. Due to fewer components coming into contact with lubricants, maintenance can be more environmentally friendly and up to 70% cheaper when compared to that of a traditional car.

A fast growing market

’’According to variety of studies, the share of electric cars in total vehicle sales is expected to be around 35% in 2040. Up to 56% of Czechs intend to buy an electric car within the next 10 years. It is therefore a fast-growing market, to which we are already responding with our DEFEND Gap and DEFEND Car Protect program, for cars with alternative fuels. In addition to electric cars, the insurance also focuses on hybrid cars and cars powered by LPG and CNG,’’ says Andrew Quirke, Managing Director of DEFEND INSURANCE GROUP.

The offer of insurance for electric cars, despite the growing market, is still a rare matter in Czech Republic. DEFEND is a trendsetter in this field. ’’The lifespan of a battery is far shorter than that of a combustion engine and therefore, the residual value of the car after a few years is much lower. That’s the reason why the insurance market has been a bit cautious about electric cars so far. However, our stable international background along with our strong insurer partners have allowed us to be one step ahead,’’ explains Quirke.

DEFEND Gap insurance, which DEFEND offers already for two years, provides protection up to purchase price (or up to the amount of debt to the leasing company) in the event of total loss or theft of the vehicle. New extended warranty, DEFEND Car Protect program, focuses on insuring car components and covers their replacement or repair in the event of a breakdown.

’’We believe, that the availability of insurance and thus protection against unexpected expenses will bring further development of both electric vehicles & alternative fuel vehicles within Czech Republic. Sales numbers and future estimates already look promising,’’ says Quirke and also adds that, “Environmental protection is an important issue for the DEFEND INSURANCE GROUP.”