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Direct Line raises issues about electric car insurance
9th January 2011 =

Car Insurance is calling for greater clarity from vehicle =

manufacturers on a number of issues surrounding electric vehicles. =

This follows the recent launch of more electric car models combined =

with Government plans to begin installing charging points in some of =

the major cities and giving motorists up to =A35,000 towards the cost of
a new electric vehicle.

Insuring the new generation of proposed electric cars will be a =

challenge, as some batteries will be leased rather than purchased, =

leading to ownership issues and there is not yet the appropriate =

disposal and salvage arrangements in place for batteries, which would =

currently be classed as hazardous waste. =

The high value of the batteries may also create a potential new target
for thieves and could also mean the battery is worth more than the =

vehicle itself in the event of an accident. The new generation of =

electric vehicles use advanced Lithium Ion batteries, such as those =

found in laptops and phones, (they are made up of a large number of =

cells) and can cost up to =A325,000.

Andy Goldby, Director of Motor Underwriting at Direct Line, said: "The
recent increase in new electric cars coming on to the market =

demonstrates how vehicle manufacturers are seriously looking at =

reducing the impact cars have on the environment. However, this =

fundamental change to the car market needs to take into account the =

need for robust insurance products, to enable drivers to be confident
that they have the appropriate cover in place.

"Manufacturers and those encouraging the increased use of electric =

powered vehicles need to ensure that the entire infrastructure is in =

place to not just charge the batteries but repair them, dispose of =

them and reuse them. It is inevitable that electric cars, like any =

others, will be involved in accidents. At the moment insurers have not
been involved in the proposals on how to deal with the batteries, the =

charging points and the potential dual ownership of the car. With the
speed in which this market is developing it is critical these =

challenges are resolved."

The challenges Direct Line would like to see addressed are:

Not all batteries will be owned by the customer, some will be owned by
the vehicle manufacturer and leased to the customer. This is =

effectively dual ownership of the vehicle, making insurance more =

complicated. =

There is an increased public liability risk when a customer is =

charging their vehicle, laying the charging lead from the home out to =

the street or across the office car park. =

Appropriate salvage arrangements need to be in place and greater =

education on how the batteries can be dealt with. =

Many batteries are classed as hazardous waste when they are no longer
useable or if the car has been written off; appropriate disposal =

facilities have to be available. =

The knowledge of repairing electric vehicles is very limited and =

appropriate access to training needs to be put in place as the market
develops. [Copyright =A9 2011 Easier Inc]
Electric vehicle manufacturers 'should work closely with insurers'
TRL - Independent Transport Research - Jan 11, 2011
Providing insurance for a new generation of electric car owners could
prove difficult, as some batteries are likely to be leased - rather =

than owned ... =


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