Want to Go Electric? Read this first!

Over the 12 months of 2012, about 130 000 electric cars were sold worldwide. In 2022, that many are sold in a single week, with 16 million electric vehicles currently on global roads. How does South Africa shape up?

Sales of electric vehicles (EVs) more than doubled in South Africa in 2021, but from a very low base. The 218 EVs sold locally constituted a market share of 0.046% of 464,122 new vehicle sales. It sounds like a small number – and it is – but it's in line with global sales growth, which doubled from 2020-2021 to 6.6 million (a remarkable 9% of global car sales).

That number is set to rise to 9.5 million vehicles in 2022 if the global semiconductor supply problem is solved. An even more telling indicator of the future of electric cars is that the net growth for global car sales in 2021 came from EVs, according to an International Energy Agency (IEA) report. This suggests that new car buyers are turning their backs on petrol- and diesel-powered vehicles, and are looking for greener alternatives.

Read more: How the Global Semiconductor Shortage Will Impact You Directly

With many countries clamping down on fossil-fuel-burning vehicles (the European Union is mulling an outright ban by 2035), those numbers will only grow. South Africa will have to keep pace, both in terms of our commitment to the Paris Climate Agreement to limit carbon emissions, and as a major manufacturer and global exporter of vehicles.

As we transition – and for the 1,600 EVs currently on the road in SA – we'll need to look at factors such as availability of charging points for plug-in vehicles, service, maintenance and Car Insurance.

Insuring electric cars in South Africa

Wynand van Vuuren, Client Experience Partner at King Price Insurance, says there are two areas to consider when it comes to insuring an EV in South Africa: the price of the vehicle and the need to ensure that home charging infrastructure is compliant.

"If you have an EV, your insurance experience will be similar to that of a conventional vehicle," he says. "You'll probably pay a bit more to insure an EV because it's more expensive than your average vehicle and they cost more to repair than conventional cars. That said, the standard factors like your age, claims history and where you live will still be the biggest determining factors of your personal risk."

The low numbers of EVs on South African roads – and therefore the challenges of disposing of them – make them less likely to be stolen, according to van Vuuren.

Beyond Car Insurance

Van Vuuren warns that the bigger change would come about with the installation of charging equipment at home.

"This type of equipment will have to be installed professionally and connected to the building's power grid. It will have to be noted on your Building Insurance policy schedule to ensure that issues like power surges are covered," he says. "This will have an impact on your Building Insurance, and you should preferably discuss this with your insurer or broker before you install any charging equipment at a residence."

It's also worth checking with your current insurer whether your at-home charging station is included under your existing home contents cover.

Learn more: A Guide to Insuring Your Home and Keeping it Fully Covered

Changing the way we move

"There's no doubt that EVs are going to become a way of life in South Africa sooner than we think. But ultimately, changing ownership patterns will have a greater impact on the insurance industry than EVs," explains Van Vuuren.

There are currently about 10 different fully electric vehicles on the market in South Africa, but manufacturers are working hard to change that. Incoming for the rest of 2022 – and the near future – are two new BMWs (the iX3 and i4 M50); four from Mercedes-Benz (EQA and EQB SUVs, and EQE and EQS sedans); more Audi e-tron models; and the much-anticipated Volkswagen options.

More models and wider choice should bring greater affordability. For reference, the cheapest EV currently on the market in South Africa is the Mini Cooper SE at R658,000, while the Porsche Taycan Turbo S is on the other side of the spectrum and retails for just over R4 million.

Compare insurance quotes for EVs like the Mini Cooper SE, BMW IX and Porsche Taycan – and plenty of other vehicles – online with Hippo.co.za.

This article is for informational purposes only and should not be construed as financial, legal or medical advice.