The steep rise in electric vehicle sales is a pivotal moment for all EV stakeholders, writes Adrian Watson, Head of Engineering Research at Thatcham Research.
September 2021 was the UK’s best month ever for new battery electric vehicle (BEV) registrations, according to the Society of Motor Manufacturers and Traders. Not only did the 32,721 new BEV registrations account for 15.2% of the market, but that figure fell not far short of the total number of BEVs registered during the whole of 2019.
This surge in EV adoption is exciting news for automakers, suppliers, dealers, and charging companies.
It’s also a positive boost for the UK’s Net Zero Strategy, which targets carbon neutrality by 2050, leaning heavily on vehicle electrification.
Crucially, though, it marks a pivotal moment for all EV stakeholders. As the UK plugs into EVs, now is the time for those throughout the value chain to ensure they have everything in place to support this rapid transition to electrification.
Same but different
In many ways—most notably in appearance and purpose—EVs are no different from internal combustion engine (ICE) vehicles. But beyond the feeling of driving an EV off the forecourt and into the future, and the seemingly obvious process of plugging in rather than pouring in, there are some key and very new differences in the user experience.
Much of the debate around EVs has centred to date on encouraging EV adoption, addressing range anxiety and charging infrastructure, and offering tax incentives and other benefits. But under the hood, so to speak, lie everyday essentials, such as repairability, serviceability, affordable insurance, and the claims process so critical to putting any new vehicle on the road. And nowhere is the difference between EV and ICE more clearly underlined than in the insurance claim chain.
For the EV owner, the process of shopping for appropriate levels of insurance cover and comparing competitive premiums remains broadly similar to the purchase of ICE insurance. But our research shows that every stage of a claim involving a BEV needs to be BEV-specific. Currently it is not.
The moment an EV policyholder first raises a claim should trigger an EV-specific claims process. The call handler’s script should ensure appropriate processes are followed, from providing vital vehicle-specific information to first responders, if required, alerting them to the vehicle’s high voltage (HV) system; to ensuring vehicle recovery and salvage agents deploy the correct equipment and handle the vehicle safely; to sending the vehicle to an appropriately equipped workshop where suitably qualified technicians are allocated to the job; to ensuring the vehicle’s battery can be quickly and safely powered down, the vehicle repaired, and returned in an acceptable timeframe to the customer—and “acceptable” means no longer than for an equivalent ICE vehicle.
But there’s a gulf between what should happen, and what does.
Normalising EV claims
The growth in the EV market is a clear sign that EV-specific claims will quickly become the norm, and “EV claims” will quickly become “claims.”
That’s why, at Thatcham Research, we’re using our engineering skills and knowledge to anticipate new challenges, quantifying them for our insurers and their repair network, and turning that into valuable data and insight. Our work focuses on how to manage HV batteries in the repair process, addressing recycling and “second life” solutions, and delivering skills into the industry via our ‘EV Ready’ training programme to ensure safety for everyone that might come into contact with a zero-emissions vehicle.
At Thatcham Research, we support the transition to electric mobility. But this can only be achieved within a well-developed, sustainable EV ecosystem. The rate of EV adoption is growing, rapidly—but it’s rapidly outpacing the development of a supporting ecosystem. Although investment is being poured into charge-point installation, a sustainable ecosystem involves so much more, from vehicle design and repair networks to insurance itself.
Close the gap
From the outset, vehicle manufacturers building repairability into design would simplify the repair process, and vastly improve the claim chain; by contrast, failing to do so can extend insurance claims, increase insurance premiums, and significantly dent the customer experience.
The growing EV market also presents insurers with an exciting opportunity to close the gap between ICE and EV claims, and encourage and support the early adoption of efficient vehicle technology with suitable, keenly priced, even innovative insurance propositions—and in doing so, support the evolution of sustainable mobility.