Limited distribution of EV spare parts push up motor premiums

The prices of spare parts for electric vehicles (EVs) are expected to increase due to their sales by a very limited number of garages, according to insurance experts.

This situation would lead to hikes in EV motor insurance premiums and have caused delays in the repair period of such vehicles, reported Emirates Today.

Insurance expert, Mr. Fouad Salem, said, “The prices of electric car insurance policies fall short of covering the insurers’ expenses, especially with regard to spare parts, which are much more expensive here than in the global market, due to the absence of sales agencies within the country. The sales of spare parts required for repairs is limited to a few garages that are then able to control prices.”

He indicates that EV spare parts in the UAE cost four or five times that in several other countries.

He pointed out that the continued rise in the prices of EV spare parts would inevitably push insurance companies to raise the premiums payable on policies for the insurers to cover operating costs.

An insurance executive said that the UAE should invite EV manufacturers to set up direct repair agencies in the country, to reduce the time taken to carry out repairs and lower the prices of spare parts, to enable EV insurance coverage to be sold at reasonable prices.

Source: meinsurancereview.com