The EV insurance ‘sting’ facing Aussie drivers fleeing the fuel crisis
Despite more drivers making the electric transition, new data has revealed that EV insurance quotes have increased by 10 per cent in one year.
By now, most drivers are feeling the financial pinch at the bowser amid the ongoing conflict in the Middle East. And while some drivers turn to stockpiling to get ahead of an uncertain economy, some motorists are jumping into fully electric cars.
According to recent data from CommBank, new EV car loans surged by a whopping 161 per cent in March compared with the weekly volume average recorded in February before the war in Iran started. But it’s not just private drivers who are making the electric transition.
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According to CommBank, business loans on just Teslas alone increased by 268 per cent in March year on year, with the bank expecting this “demand to continue under current macro conditions”.
While the pricing barrier is slowly being erased, with brands such as BYD offering a fully electric car for under $30,000 before on-road costs, new data has revealed that the cost of insuring an electric car has risen year on year despite the recent surge in sales.
According to Compare the Market’s latest EV insurance index, comprehensive insurance quotes on electric cars rose by an average of 10.2 per cent between 2025 and 2026, while premiums on hybrid models also increased by 6.6 per cent in the past 12 months.
The bi-annual report – which analysed polices across 11 unspecified insurers – revealed that it cost approximately $2300 on average to comprehensively insure an EV in Australia, while the general insurance cost for hybrid cars was approximately $1700.
The finance comparison site’s data revealed that the average quoted premium for the Tesla Model Y RWD – the best-selling electric car last year – increased by $164 (5 per cent) from $3039 in March 2025 to $3203 in March 2026.
Meanwhile, the Tesla Model 3 sedan recorded a 3 per cent increase on its average quoted premium – from $3257 in March 2025 to $3356 in March 2026.
While insurance costs vary by individual circumstances, a Tesla Australia spokesperson told Drive in February 2026 that its brand-backed insurance product has led to lower premiums for its models.
“InsureMyTesla (Zurich) has seen average premiums across Australia reduce to approximately $1644. As with all insurance products, there will be a differential between states; however, the average price for the Tesla Model 3 and Model Y has reduced during the 12 months,” they said.
The largest average quoted premium increase among the EVs analysed in the report was for the Xpeng G6 and the Toyota bZ4X, with insurance quotes increasing by 24 per cent each.
According to Compare the Market’s Economic Director, Eric Koch, labour and spare parts issues were the main reasons behind the increase in EV insurance premiums.
“The rising cost of labour and parts continues to push premiums higher, and this particularly affects electric cars due to battery replacement costs and specialised training needed for repairs,” he said in a media statement.
| Make and Model | March 2025 | March 2026 | Year-on-year difference |
| Tesla Model Y RWD | $3039 | $3203 | +$164 (5%) |
| Tesla Model 3 RWD | $3257 | $3356 | +$99 (3%) |
| MG 4 Excite 51 | $1592 | $1524 | -$68 (4%) |
| Kia EV5 Standard Range | $1781 | $1921 | +$140 (7%) |
| BYD Sealion 7 Premium | $1786 | $1795 | +$9 (0.5%) |
| BYD Dolphin Essential | $1437 | $1578 | +$141 (9%) |
| Zeekr X RWD | $1831 | $2271 | +$440 (19%) |
| Xpeng G6 Standard Range | $1610 | $2135 | +$525 (24%) |
| Toyota bZ4X 2WD | $1601 | $2122 | +$521 (24%) |
| BMW iX1 eDrive20 | $2777 | $3152 | +$375 (11%) |
| All model averages | $2071 | $2306 | +$235 (10%) |
Compare the Market’s data also showed that some popular hybrid models saw an increase in their quoted insurance premiums.
The BYD Sealion 6 recorded the largest rise among the hybrid models quoted in the report at 18 per cent ($339), from $1482 in March 2025 to $1821 in March 2026.
In the case of the BYD Shark 6, the average quoted premium on the plug-in hybrid ute increased by $113 – from $2059 to $2172 – representing a 5 per cent rise year-on-year.
Meanwhile, the Toyota RAV4 – the second best-selling car by volume in 2025 – recorded an average increase of 9 per cent, up $166 year on year.
Interestingly, popular hybrid models from Toyota, such as the Corolla and Camry, have seen average insurance quotes reduced by 5 and 2 per cent, respectively.
The median insurance quotes on hybrid variants of Hyundai’s two best-selling models, the Kona and Tucson, also rose by $81 and $134, respectively.
The post The EV insurance ‘sting’ facing Aussie drivers fleeing the fuel crisis appeared first on Drive.
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