ACKO launches battery insurance plan for EVs Apextalk

Mumbai: Private insurer ACKO General Insurance launched “Extended Battery Warranty” plan on Monday, targeting electric vehicle (EV) owners. The policy is designed to boost EV affordability by enabling banks to lengthen loan terms and reduce monthly installments.

“This will indeed ease the lives of our customers and promote a nationwide rapid adoption of EVs,” said Animesh Das, VP – Motor Underwriting, ACKO.

The first-of-its kind policy safeguards battery life for up to four or five years and provides performance coverage for up to 60,000 km. Additionally, the comprehensive plan covers EV components alongside the battery and is transferable to a new owner in the event of a sale, boosting resale value, said ACKO in a press release.

Developed in collaboration with Ola Electric and Ather Energy, the insurance plan is part of ACKO’s broader strategy to establish an EV infrastructure by partnering original equipment manufacturers (OEMs) and providing comprehensive insurance plans to customers.

“The Indian EV journey is an aggressive growth story which has propelled the demand for customized protection solutions amongst customers. Our research report found a demand for these solutions from 79% of the respondents,” said Das.

The report also underlined that 67% of EV owners want to own an insurance policy with their EVs.

“This will address the existing pain points and thereby bring a radical disruption in the fast-evolving EV industry,” said ACKO.

With a massive 223% growth in EV sales in 2022, India’s EV market is expected to expand at a 44.5% CAGR between 2020 and 2025. As per an ACKO research report, 49% of EV car owners believe battery replacement costs are a significant part of EV ownership. Also, 66% assume that battery life only lasts between two to five years, and a majority of EV users believe that charging behavior has a definite role to play in the vehicle’s battery life.

ACKO plans to continue disrupting the EV space by introducing innovative products and exploring partnerships with several other OEMs to offer comprehensive coverage for EVs, the insurer said in a statement.

India’s EV industry is thriving on robust demand, with EV sales crossing 10 lakh units in FY23. Two-wheelers made up for the bulk of EV sales in FY23.

However, delays in subsidy disbursements, under FAME-II, have slowed manufacturing, according to the Society of Manufacturers of Electric Vehicles (SMEV).

The subsidy allows for on-road prices to be cut by around 35%, supporting manufacturing of 10 lakh electric two-wheelers, five lakh electric three-wheelers, 55,000 electric four-wheelers, and 7,000 buses. Another 10,000 crore has been allocated under Fame-II for EV charging stations. As of October 2022, at least 64 EV manufacturers had registered to receive incentives.

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