EV Insurance Demand in India Soars 16x in 3 Years: Delhi-NCR Leads with 18.3% Market Share

India is experiencing a significant shift in the automotive sector, as the demand for electric vehicle (EV) insurance has surged dramatically in just three years. The share of insurance policies for EV cars has skyrocketed from 0.50% in FY23 to a remarkable 14% by March 2025. 

This surge reflects both the nation’s growing focus on sustainable mobility and the increasing recognition among consumers of the importance of insurance tailored specifically for electric vehicles.

EV Insurance Demand by Region

The adoption of electric vehicles, especially in metropolitan areas, has been a key driver in the rise of EV insurance policies. Major cities are at the forefront of this growth. The Delhi-NCR region leads with an 18.3% market share, followed closely by Bangalore at 16%. Other key metropolitan hubs such as Pune, Chennai, and Mumbai-Thane also contribute significantly, accounting for 55% of all EV insurance policies purchased in the country.

When breaking down the data further, we find that tier-I cities dominate the EV insurance market, capturing 58% of all policies. Tier-II and tier-III cities, however, are not far behind, with respective shares of 30% and 12%.

2-Wheeler EV Insurance Surge

Notably, the 2-wheeler EV segment is seeing a particularly sharp increase in insurance policies. The number of insured two-wheeler EVs has doubled in the past year, with policies now accounting for 7-8% of all two-wheeler insurance policies under five years. This surge is largely driven by the dominance of electric scooters in the market, which make up nearly 99% of insured two-wheeled EVs.

The Shift Towards Comprehensive EV Insurance

As consumers become more aware of the unique needs of electric vehicles, there is a noticeable trend towards opting for more comprehensive insurance packages. These packages offer added protection and coverage, including popular add-ons such as Zero Depreciation, Roadside Assistance, Battery Cover, and Tyre Protection. For two-wheeler EVs, specialised add-ons like Battery Protector (for theft or damage) and Charger Cover are increasingly in demand, catering specifically to the needs of electric vehicle owners.

The growing demand for such add-ons indicates that consumers are becoming more knowledgeable about the risks associated with electric vehicles and are seeking insurance solutions that provide extensive coverage and peace of mind.

Conclusion

The rise in demand for electric vehicle insurance is a clear indication of the shift towards sustainable mobility in India. As EV adoption continues to grow, particularly in urban areas, it is expected that the demand for specialised insurance products will continue to increase. This surge highlights the importance of addressing the unique needs of EV owners and the increasing recognition of tailored protection plans.

In response to this growing demand, insurance providers are stepping up with more comprehensive packages, offering enhanced protection and add-ons, catering to the evolving needs of India’s expanding EV market.

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