EV insurance gap comes into focus as buyer demand accelerates

Driver interest in electric vehicles is rising fast across Australia, but industry findings released this week highlight an ongoing ownership cost that many new buyers overlook: comprehensive insurance.

Fresh figures published by Insurance Business and major insurer NRMA Insurance show that inquiry volumes for electric car policies jumped 72 per cent in September 2026 compared to the same time last year, and are up 80 per cent across the first nine months of the year. The surge matches shifting showroom patterns, with battery-powered cars taking a record slice of monthly deliveries.

Yet the cost of covering an electric model remains noticeably higher than an equivalent petrol vehicle. Research highlighted in the industry reports indicates like-for-like comprehensive EV cover can sit up to 39 per cent higher, with typical annual premiums running roughly $800 to $900 above petrol equivalents. Actuarial analysis also points to much wider variance among underwriters when quoting for electric cars, creating substantial price gaps between the most competitive and most expensive policies.

In its latest Changing Gears consumer research, NRMA Insurance reported that almost a third of Australians now actively weigh up buying a battery electric car, with only 17 per cent ruling the switch out entirely. At the same time, practical ownership expenses such as repair complexity, parts sourcing and specialist labour continue to influence how underwriters assess risk and price their policies.

What this means for your novated lease

For employees looking at novated leasing, the premium difference between electric and combustion vehicles reinforces why salary packaging your running costs makes a big difference to your household budget.

• Pay insurance with pre-tax income: Unlike traditional private car finance where you pay comprehensive cover from post-tax wages, a novated lease lets you package your vehicle insurance alongside finance payments, servicing and charging.
• Maximise the FBT exemption: Under the current federal electric car discount, eligible zero-emission models priced beneath the fuel-efficient Luxury Car Tax threshold of $91,661 attract a complete exemption from fringe benefits tax. That exemption covers approved running expenses too, so paying a higher insurance premium entirely out of pre-tax earnings significantly dulls the sting of steeper policy pricing.
• Shop around within your lease: Because price gaps between different insurers can run into hundreds of dollars on the exact same electric model, you do not have to accept the default quote. Check whether your salary packaging provider allows you to source competitive comprehensive cover or switch policies at renewal time.

Factoring insurance into your upfront lease calculations ensures there are no surprises when you make the transition to an electric car.