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How Much Does Auto Insurance Cost for Electric Vehicles?

May 12, 2020
5 mins
A man reaches for the volume dial while driving his car

Canadians are still hesitant to adopt electric vehicles.

According to a 2018 survey, 72% of Canadians approve of electric vehicles but only 5% were interested in buying one. The reasons were many: a lack of public charging stations, worry about electrical bills at home, finding a qualified mechanic, and vehicle reliability and durability.

Then there’s the price. Electric or hybrid vehicles sell for somewhere in the $30,000 to $40,000 range. Unfortunately for Ontarians, the rebate program offering up to $14,000 for people buying electric vehicles (EV) was scrapped by Ontario premier Doug Ford in December 2019.

But that environment is changing. Thanks to an $8 million federal investment in Ivy, a network of 160 charging stations at 73 locations in Ontario in February, and Petro Canada’s 2019 Electric Highway rollout across Canada, it’s easier than ever to plug-in and recharge an EV when on the road.

There is also a growing body of research demonstrating that operating costs for EVs on an ongoing basis are substantially lower than for petrol-powered vehicles. According to BC Hydro, a Nissan Leaf costs about $490 a year to drive 20,000 kilometres, while an equivalent gas-powered vehicle would cost $1,880.

Maintenance costs are lower, too. A battery replacement may be expensive, but warranties tend to run five to eight years. Because of regenerative braking — where the motor slows to reclaim energy — brakes can last up to 300,000 kilometres.

How Car Insurance Compares between an EV and Gas-Powered Cars

Auto insurance is also an ongoing component of the cost-to-drive an EV. Are insurers helping to make EVs more attractive for Canadian buyers? Some insurers are indeed offering green incentives for insurance buyers, including Desjardins and TD Insurance.

We’ll use the Nissan Leaf, which has been named the cheapest to operate over five years every year since 2018, as our standard for EVs in this insurance showdown. Representing the fuel oil team, we’ll take the reliable, best-selling Honda Civic, and the Chevrolet Cruise.

Using the premium calculator, and an identical profile for drivers and coverage — 30-year-old female, 10 years of driving experience on a full licence (G in Ontario, 5 in Alberta) and a clean record, we ran a comparison of rates for each vehicle. We even matched neighbourhood profiles in Toronto and Calgary through Environics Analytics’ PRIZM mobile app.

While we found the Leaf won both rounds, the annual costs were surprisingly tight:


  • Nissan Leaf: $2,561
  • Chevrolet Cruise: $2,598
  • Honda Civic: $2,772


  • Nissan Leaf: $2,022
  • Chevrolet Cruise: $2,088
  • Honda Civic: $2,370

What Else Affects the Cost of Auto Insurance for an EV?

The Canadian Loss Experience Automobile Rating (CLEAR) system takes into account the safety and loss prevention features of a vehicle — premium tires, side airbags, theft prevention features, for example — to help insurers set premiums for vehicle insurance. Given similar features, the higher price of electric vehicles, you would expect higher premiums.

That’s offset by the green discounts offered by insurers to the extent that drivers can expect a discount of perhaps 10% over a comparable gas-powered vehicle. If every penny counts — and given considerably lower maintenance costs — an EV may be worth considering.

Dave Webb

Dave Webb is a writer and editor of 30 years’ experience. He has written about municipal politics, conservation issues, information technology, medical technology, music, and the manmade diamond industry along with insurance. And some sports. He is also an avid semi-professional roots musician. He lives in Toronto.

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