From Next Month, Full Compensation Will Be Provided for Electric Vehicle Battery Damage

Early Next Month, Full Compensation Special Contract for Electric Vehicle Batteries to Be Sold

[Asia Economy Reporter Kim Jin-ho] Starting next month, consumers using electric vehicles will no longer have to bear part of the replacement cost even if battery damage occurs. This is because, following the financial authorities' recommendation, non-life insurance companies will introduce a special clause (rider) that requires the insurer to cover the full replacement cost.

According to the Financial Supervisory Service on the 28th, most insurance companies plan to sell a special rider covering the full cost of electric vehicle battery replacement starting early next month.

The introduction of this rider is a measure taken considering that the compensation method for batteries in individual insurance terms is unclear, which could lead to disputes. It also takes into account that only some insurers currently offer a full battery replacement cost coverage rider, limiting consumer choice.

Accordingly, the Financial Supervisory Service decided to clearly improve the battery compensation method in individual terms and introduce products that require all insurers to fully cover battery replacement costs in case of self-accidents.

With the introduction of the rider, if a vehicle with a battery value of 20 million KRW and a battery lifespan of 15 years suffers battery damage in an accident two years after delivery and requires replacement, customers without the rider must bear 2/15 of the battery value, i.e., 2.67 million KRW, while customers with the rider do not have to pay any additional cost.

A Financial Supervisory Service official stated, "The introduction of the full battery replacement cost coverage rider is expected to eliminate the blind spots in coverage for electric vehicle batteries, which were previously insufficiently compensated, and expand consumer choice."

Meanwhile, according to the Financial Supervisory Service, the number of registered electric vehicles has rapidly increased from 5,712 units at the end of 2015 to 134,962 units at the end of 2020, due to government efforts to expand eco-friendly vehicle distribution and growing public interest.

This content was produced with the assistance of AI translation services.