Electric vehicles (EVs) in South Korea have a slightly higher risk of fire and explosion compared to traditional gasoline-powered cars. (Image courtesy of Yonhap)
SEOUL, Aug. 19 (Korea Bizwire) – A recent study by the Korea Insurance Development Institute has found that electric vehicles (EVs) in South Korea have a slightly higher risk of fire and explosion compared to traditional gasoline-powered cars, potentially impacting insurance premiums and safety perceptions.
According to data released on August 18, there were 53 fire and explosion incidents involving EVs covered by comprehensive auto insurance from 2019 to 2023, equating to 0.93 incidents per 10,000 EVs.
In comparison, non-electric vehicles experienced 6,256 such incidents, or 0.90 per 10,000 vehicles.
The financial impact of these incidents was significantly higher for EVs. The average damage cost per EV fire or explosion was 13.14 million won, nearly double the 6.93 million won for conventional vehicles.
This data represents an increase from the 2018-2022 period, when EV fire incidents occurred at a rate of 0.78 per 10,000 vehicles, suggesting that the rise in EV adoption has been accompanied by more frequent fire incidents.
The study also revealed that EVs had a higher overall accident rate, with 1,096 comprehensive insurance claims per 10,000 vehicles, compared to 880 for non-electric vehicles.
The average cost per claim for EVs was 2.96 million won, 66% higher than the 1.78 million won for conventional vehicles.
Analysts at the Korea Insurance Development Institute attribute the higher accident rates primarily to the longer average driving distances of EVs, which increases their exposure to risk.
The rapid acceleration capabilities of EVs are also considered a contributing factor.
These findings have implications for insurance premiums. EVs are currently subject to premiums approximately 7% higher than those for internal combustion engine vehicles.
Samsung Fire & Marine Insurance, which holds a 28% market share in auto insurance, reported charging premiums for EVs that are about 1.4 times higher than those for conventional vehicles.
The issue of EV safety has gained renewed attention following a recent fire in an underground parking lot of a large apartment complex in Incheon.
Over 700 vehicle owners have filed comprehensive insurance claims for damages resulting from this incident.
Samsung Fire & Marine Insurance alone has received 360 claims, estimating the total damage at around 2.2 billion won.
Kevin Lee (kevinlee@koreabizwire.com)
