The Risks of EVs in Business Use
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Electric vehicles (EVs) are no longer niche but an increasingly larger part of how businesses move, deliver, and operate.
Whether it’s a single BYD Sealion used by a tradie or a small electric fleet for courier services, EVs offer lower running costs, tax incentives, and a more sustainable footprint. But they also raise new insurance questions—especially around lithium batteries, workplace charging, and transport risks that may not be covered by standard policies.
Why EVs Are Changing Business Risk Profiles
EVs bring unique exposures: fire risk from lithium-ion batteries, complex diagnostics and repair costs, and uncertainty around liability when damage arises from software or battery faults. While rare, EV battery fires are intense, can reignite days later, and are hard to extinguish. Business owners need to know if their motor or property policy factors in this elevated risk—especially when charging EVs onsite or storing them indoors.
Tip: Many SME motor insurance policies are still tailored for petrol or diesel vehicles. Talk to us about EV-specific policy terms and exclusions.
EV Fires in Transit: What SMEs Need to Know
In March 2024, a lithium battery fire aboard the Morning Midas cargo vessel destroyed hundreds of EVs and led to an estimated $500 million in losses. While most SMEs won’t be shipping bulk EVs overseas, this incident is a reminder: if your business is importing, relocating, or transferring an EV between sites or depots, you need the right marine or transit cover in place—especially if you're listed as the cargo owner.
Key gaps brokers help identify:
- Lithium battery exclusions in marine policies
- Lack of liability clarity if transporting via third-party carrier
- Uninsured losses when compliance with dangerous goods rules lapses
Everyday Scenarios Where EV Cover Can Fall Short
Here’s how risks show up in day-to-day operations:
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A solar installer uses a new EV van for customer visits, but hasn’t told their insurer they’ve switched from diesel. The result? Potential
coverage issues on charging equipment stored onboard.
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A food delivery business parks EV scooters in an underground lot. A battery fault triggers a fire damaging multiple units and adjacent
property. The business discovers their policy excludes fires from lithium-powered vehicles.
- A construction firm with mixed vehicles plugs its new EV ute into a wall socket. An overheat incident causes electrical damage and denies a claim due to improper charging setup.
Expert Support for Evolving Vehicle Risks
Don’t assume your existing motor or business property policy is EV-ready. We play a critical role in:
- Reviewing whether lithium battery exclusions exist
- Ensuring your policy aligns with how you actually use or move EVs
- Clarifying cover for onboard tools, charging incidents, or battery failure
- Keeping you updated on EV transport compliance if you operate across regions or industries
Bottom Line: EVs may be low-emission—but they’re not low-risk. Before your business invests further in electric vehicles, let us make sure your insurance is as modern as your fleet.
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