China’s car market is now generally recognized to be the largest one in the world, and the adoption of electrification is happening at a rapid pace. However, Chinese consumers are now dealing with an unexpected side effect of the push towards “new energy” vehicles: significantly increased insurance premiums.
Another possible reason she mentioned is the higher potential for costly incidents. Data from the Chinese Ministry of Energy Management’s Fire and Rescue Department shows that in the first quarter of this year, 640 new energy vehicle fires have been reported, 32 percent greater than over the same period in 2021. That number is also far higher than the total increase in fires for transportation vehicles overall, which was 8.8 percent. The ministry has further stated that the risk of fires is greater for NEVs than for traditional vehicles.