Chinese-made EVs in Germany face car insurance premiums up to twice as high... What's the point of buying cheap?

*This content was translated by AI.View Original

While Chinese electric vehicle manufacturers are threatening Europe's finished-vehicle industry with their low sales prices, an analysis has emerged suggesting that the insurance premiums incurred after purchasing a vehicle can easily offset the advantage of the affordable car price.

On the 13th, German weekly news magazine Spiegel reported, citing an analysis by comparison portal Verivox, that the comprehensive auto insurance (Vollkasko) premiums for Chinese-made electric vehicles are nearly twice as high as those for new cars from Europe, the United States, Japan, and South Korea in most models.

Verivox compared the insurance premiums of Chinese-made electric vehicles with those of European and East Asian vehicles of similar specifications, finding that annual premiums were up to 870 euros (approximately 12.8 million won) higher depending on the model. Comprehensive auto insurance is a product that covers damage to the driver's own vehicle in addition to liability insurance, which is mandatory. This premium calculation was conducted based on identical hypothetical conditions: a 45-year-old driver residing in Berlin, with an accident-free discount class of 15, and an annual mileage of 12,000 km.

The primary reason for the high insurance premiums on Chinese-made electric vehicles is that insurers assign these vehicles to a higher average vehicle model class (Typklasse). Aljosa Ziller, Managing Director of Verivox's insurance comparison division, explained, "For new models, it is necessary to estimate accident risk and repair costs, so a higher class is assigned as a precaution." This is because many Chinese manufacturers have only entered the German market for a few years, leaving insurers lacking in data on the manufacturers themselves, as well as experience with parts prices and supply availability.

However, the insurance classes for Chinese brands are gradually improving. According to a recent survey by Germany's Allianz Technology Center (AZT), the vehicle model class of Chinese-made cars improved by an average of 1.5 classes since 2024, while vehicles from European manufacturers worsened by 0.5 classes. Verivox also noted that in some cases, insurance premiums for certain Chinese brand models are already lower than those for comparable vehicles from established automakers.

Meanwhile, European countries are introducing measures to limit the local sourcing ratio of core components such as batteries, as well as banning Chinese-made cars from entering German military facilities, alongside this insurance premium issue. In response, Chinese automotive makers have urged caution, stating that these measures by European countries should not act as non-tariff barriers or regulatory tools.

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*This content was translated by AI.View Original