Low emission car insurance

We all want to do our bit to reduce our impact on the planet. One of the shifts many people are making is to choose a more environmentally-friendly car. Maybe you’re interested in a full or plug-in hybrid, or are keen to go fully electric. Or perhaps you just want to buy a petrol car that’s less polluting than most. This guide outlines what counts as a low emission car and, crucially, what owning one means for the cost of insurance.

What counts as a low emission car?

The official answer, according to the UK Vehicle Certification Agency, is that a low emission vehicle (LEV) is one that produces less than 100g of CO2 for every kilometre (0.6 miles) travelled. There’s a sub-category within this of “ultra low emission vehicles”. These produce less than 75g of CO2 per kilometre travelled.

The types of cars that typically qualify as low emission vehicles are either:

• Electric cars. These produce no emissions at all and are often described as zero emission vehicles (ZEVs).
• Hybrid cars. Though be aware that not every hybrid model qualifies as a low emission vehicle.

Petrol cars aren’t categorically excluded from being counted as low emission vehicles, but in practice, few petrol cars are likely to have sufficiently low official CO2 emissions.

Examples of low emission cars

All fully electric cars qualify as low emission cars, as they produce no CO2 at all. Popular EVs include the Nissan Leaf, the Kia E-Niro, the Volkswagen e-Up, the Mini Electric and, of course, the iconic (and pricey) Tesla Model X.

Popular hybrids that make the cut include:

• Mini Countryman Plug-in Hybrid
• VW Golf GTE Plug-in Hybrid
• Toyota Prius Plug-in Hybrid

What is low emission car insurance?

In most cases, low emission car insurance isn’t a specific category of car insurance (or, at least, not yet). While not every insurer will cover every type of low emission vehicle, you’ll be able to find insurance for low emission cars via most price comparison sites. So owning a low emission vehicle shouldn’t mean you’ll find it any harder to find insurance.

Having said that, there are car insurance providers that specialise in cover for ultra low emission vehicles. These target their policies specifically at owners of electric, hybrid and plug-in hybrid cars.

How do I know if my car is low emission?

You can check the official CO2 emissions of new and used cars using the Vehicle Certification Agency’s search tool. This also lets you check a car’s fuel consumption and tax band.

It’s worth knowing that, somewhat confusingly, the CO2 emissions that qualify a car as a “low emission vehicle” are different from those that might permit a car to drive in a UK city’s low emission zones – London’s ULEZ, for example.

What is the London ULEZ?

The ULEZ, or Ultra Low Emission Zone, is a defined area of London. You can only drive in this area free of charge if your vehicle meets certain emission standards. If you don’t meet the entry requirements, you have to pay a penalty to drive in the ULEZ.

The specific entry requirements depend on the type of vehicle and its engine (petrol vs diesel, for example). Petrol cars must meet Euro 4 emissions standards, while diesel cars must meet Euro 6 emission standards.

The emission levels dictated by these standards are less strict than for a car to be officially considered a low emission car according to the Vehicle Certification Agency. Most petrol cars registered with the DVLA after 2005, and most diesel cars registered after September 2015, should be able to drive in the ULEZ without paying the ULEZ charge. If you drive an older car, or are uncertain about whether your car meets the criteria, you can use Transport for London’s vehicle emissions checker.

How do low car emissions affect my insurance?

When insurers set their premiums, they’re primarily worried about 2 things:

1. How likely you are to make a claim.
2. How much it will cost them if you do make a claim, to either repair or replace your car.

The former is why they ask lots of questions about things like your age, where you live, how many miles you do each year and any claims history. All of these factors play into how risky you are to insure.

In and of itself, driving a low emission car doesn’t make a driver any less likely to make a claim. That said, there’s a theory that early adopters of electric vehicles, for example, are ethically minded and that this might make them safer, more conscientious, and lower-risk drivers. If an insurer has evidence to back this up, this could lower your premium.

Car insurance groups

Another key factor for insurers is what car insurance group your car is in. This is influenced by things like a car’s value when new, how powerful it is, what safety features it has that can reduce the risk of an accident or minimise damage, and the cost of parts and repairs.

Some of these points are also about the risk of making a claim in the first place – there’s evidence that more powerful cars are more likely to be involved in accidents, for example. But many are about how much an insurer will have to shell out in the event of a claim.

Electric and hybrid cars are typically more expensive to buy new than traditional petrol or diesel cars, and their more specialist technology can make them pricier to repair. So this may push them into a higher car insurance group than an equivalent petrol or diesel model. The higher the insurance group, typically the pricier the insurance.

The examples of low emission vehicles we’ve highlighted above fall into car insurance groups ranging from group 50 for the Tesla Model X, to group 10 for the diminutive VW e-UP. For comparison, petrol versions of the VW e-Up can sit in anywhere from group 1 to group 17, depending on the specific model.

What levels of cover can I get for my low emission car?

If you have a low emission car, you’ll be able to choose from the same levels of cover as anyone else.

• Third party car insurance. This is the minimum legal requirement for drivers. It covers damage to other people’s cars and property, but won’t cover you for damage to your own car.
• Third party, fire and theft car insurance. On top of the above, this also covers your car if it’s stolen or damaged by fire.
• Fully comprehensive car insurance. Adds accidental damage to your own car to the cover offered by third party, fire and theft insurance.

What does low emission car insurance cover?

Depending on the level of cover you opt for, insurance for a low emission car will include the same things as car insurance for a traditional petrol or diesel car. Plus, potentially, a few extras.

Many low emission cars are either partly or fully powered by electricity. This means they’ll have a large electric battery alongside the smaller 12 volt battery that is present in all cars. This smaller battery runs things like immobilisers and clocks when the engine is switched off.

So, insurance for electric and hybrid cars should also cover damage to the electric battery in the event of an accident. Plus, if you have an electric or plug-in hybrid car, which needs to be plugged in to charge the battery, you’ll also want to check that your policy includes:

• Liability cover. This protects you if someone trips over the charging cable while it’s in use, is injured and makes a claim against you.
• Cover for the portable charging cables. Make sure you’re covered in case they’re lost, stolen or damaged, as they’re essential to recharge your car when you’re away from home.

Bear in mind that low emission car insurance will also have the same standard exclusions as insurance for any other car. These include driving a vehicle that’s unroadworthy or making modifications without telling your insurer.

Can I save money by switching to a low emission car?

Finder insurance expert Danny Butler answers

That’s the million dollar question. There are lots of factors that play into the cost of owning and running a car. You need to take account of all of them when working out if a low emission car will save you money. Let’s break the key factors down.

• Upfront cost. Unfortunately, this is one where you’re very unlikely to make a saving, at the moment at least. Hybrids and fully electric cars tend to be more expensive to buy new than their petrol or diesel equivalents. But with the government banning the sale of new petrol and diesel cars from 2030, it’s expected that the cost of low emission cars will drop as demand rises.
• Insurance. This one is 50/50. There are lots of factors that play into the cost of insurance. Electric and hybrid cars can be more expensive to repair, pushing them into a higher insurance group (and potentially making insurance more expensive), but repair costs are coming down as these vehicles become more popular. Your insurance costs are as likely to be affected by the specific vehicle you choose and your personal circumstances, as whether or not your car is a low emission vehicle.
• Tax. You could be onto a winner here. Hybrid cars pay £10 a year less in car tax than petrol or diesel cars, and fully electric vehicles pay no car tax at all.
• Fuel costs. In general, electricity is cheaper than petrol or diesel, so if you’re able to run your car completely or mainly (in the case of hybrids) on electricity, then you should save on running costs. The savings will depend on whether you’re able to install an at-home charging point though. Public charge points can be much pricier, so the savings may be lower if you rely on these to charge your car. And hybrid cars tend to have quite short electric ranges. If you do a lot of long distance-driving in a hybrid, where the power source reverts to petrol or diesel, this will add to your running costs.

In summary, you’ll almost certainly pay more in the short term for an electric or hybrid car, but the lower running costs of full EVs in particular could well save you money in the long term. And, of course, you’ll have the benefit of knowing that lower emissions are better for the environment.

How can I cut the cost of low emission car insurance?

Insurance for low emission cars works in much the same way as insurance for any other car, so the tactics for keeping costs down will be similar. These include:

• Shop around for the best deal. This is probably the most important money-saver. Don’t simply choose to renew your car insurance when it’s up for renewal as you could end up paying more than you need to. Keep in mind that the cheapest policy isn’t always the best policy, so check the cover details carefully.
• Choose the right cover level. Contrary to what you might expect, comprehensive cover can be cheaper than third party (TP) or third party, fire and theft so it’s always worth checking.
• Avoid paying monthly. If you can, try to pay for your premium in one go as you’ll pay interest if the premium is spread out over the year.
• Increase your excess. Agreeing to pay a higher voluntary excess could make your overall premium cheaper. But remember that your insurer won’t pay out for a claim that costs less than your excess. So be careful about making it too high, as it could leave you out of pocket if damage occurs.
• Boost security. If your car is not currently fitted with an alarm, think about adding one to reduce your premium. Having a secure location to park your car (such as a garage or secure driveway) will also help, though this isn’t always viable.
• Limit your mileage. If you start working part-time or your long commute becomes much shorter, let your insurer know. A reduction in your mileage could result in cheaper insurance.
• Add experienced drivers. Adding an older and more experienced driver to your policy lowers the risk and could help to lower the premium.
• Limit optional extras if you don’t need them. Think carefully about which optional extras you really want, as adding extra protection to your policy will generally push the price up too.
• Avoid unnecessary modifications. Any modifications made to your car to make it look better or drive faster are likely to increase your premium so think carefully before making any changes.

Bottom line

Driving an electric or hybrid car could mean that insurance costs a bit more compared with an equivalent petrol or diesel model, thanks to higher repair costs. But driving a low emission car is unlikely to have as big an impact on the cost of car insurance as other factors, such as your driving history and where you live. If you drive a plug-in hybrid or electric car, make sure you’re covered for loss of or injury caused by the charging cables. And, as with insurance for any other car, there are plenty of ways to keep costs to a minimum.

Finder survey: What proportion of us would consider buying an electric car?

Frequently asked questions

• Is low emission car insurance cheaper?

  Not necessarily. The cost of insurance is influenced by many factors, including how powerful the car is, how easy it is to repair following an accident, and your personal circumstances. Some insurers may see low emission vehicle drivers as typically safer drivers, and charge them less. Others may charge more because low emission vehicles can have parts that are pricier to repair.

• Can I add additional drivers to a low emission car insurance policy?

  Yes. You can add named drivers to a low emission car insurance policy in the same way as for any other car.

• What is the benefit of low emission vehicles?

  The main benefit of low emission vehicles is that they are less polluting, and therefore better for the environment. There are a couple of other perks though, including typically lower running costs, lower car tax rates for hybrid cars, and no car tax at all for fully electric cars.

• What is the best car for low emissions?

  If your priority is low emissions, go for a fully electric car. These produce no CO2 emissions at all.

• How do you find the NOx of a car?

  Carbon dioxide (CO2) isn’t the only potential greenhouse gas that’s emitted from cars. With the exception of fully electric cars, which produce no emissions at all, most cars will also produce some level of NOx (oxides of nitrogen). This includes NO2, an irritant that can cause airway inflammation and affect immune cells in our lungs. You can check how much NOx a car produces using the Mayor of London’s Cleaner Vehicle Checker.

• Is low emission car insurance any different to normal car insurance?

  For the most part, no. The only real difference is that insurance for electric and hybrid cars is likely to include cover for electric batteries. It may also include cover for loss or theft of, or injuries caused by, charging cables.

• Where can I find low emission car insurance?

  Most mainstream insurers now offer cover for electric and hybrid cars, so you should be able to find cover on a price comparison site. If you can’t find an affordable quote, you can try insurance brokers that specialise in cover for low emission cars.