Thailand's electric vehicle (EV) market is expanding, while insurance providers face higher repair costs, a shortage of independent repair garages and faster vehicle depreciation, according to Nicolas Faquet, CEO and founder of Roojai Group. These factors are affecting the country's EV insurance market.

Faquet said rising fuel prices, geopolitical uncertainty and changing consumer priorities were contributing to EV adoption. Consumer concerns are shifting from traditional 'range anxiety' towards 'fuel uncertainty' as global oil price fluctuations affect transport costs and more Thai consumers consider battery electric vehicles (BEVs) to manage long-term running costs.

Thailand's EV market grew by 80% in 2025, driven by increasing EV demand and consumer interest in vehicle value, technology and operating costs.

Government measures covering manufacturing, financing and consumer incentives are also supporting EV adoption. Thailand's 30@30 policy targets electric vehicles accounting for at least 30% of domestic vehicle production by 2030. The EV 3.5 incentive package supports this target through tax incentives and production support measures, while schemes such as the Government Savings Bank's EV soft loan programme provide financing support to consumers, Faquet said.

EV insurance market

"As EV adoption accelerates, consumer attitudes towards vehicle ownership, risk and protection are evolving alongside the technology itself," Faquet said.

EVs have a different risk profile from internal combustion engine (ICE) vehicles. Accident rates are typically higher during the first year of ownership as drivers adapt to features such as regenerative braking, which recovers and stores energy in the battery as the vehicle slows down, and instant torque, which enables electric motors to deliver maximum power immediately. Accident frequency generally returns to levels comparable with ICE vehicles as drivers become familiar with these features.

According to Faquet, repair costs and complexity are among the main challenges for EV insurers. Average repair costs are around 39.7% higher than those for ICE vehicles, largely due to complex battery systems, the need for specialised equipment and trained technicians, and limited parts availability.

Thailand also has a limited number of qualified third-party EV repair networks, with most repairs carried out through authorised dealer networks. This restricts competition and contributes to higher repair costs. Faquet said increasing the number of properly certified independent repair garages would expand repair capacity, improve pricing efficiency and reduce claims costs across the industry.

Price competition is creating further underwriting challenges, as faster and more variable vehicle depreciation complicates risk pricing and claims valuation. Faquet said government incentives, manufacturer pricing and financing support were reducing EV purchase costs, while insurers had to account for higher repair expenses and changing vehicle values.

Although consumers may expect more competitive insurance premiums as EV adoption increases, insurers must also account for risks associated with new technologies, repair requirements and vehicle depreciation.

EV buyer preferences

EV customers tend to be more digitally informed and research-driven than traditional car buyers, often conducting more extensive research before purchasing. Faquet said their concerns extend beyond engine reliability and routine servicing to the requirements of a different vehicle ownership model.

Battery protection remains a consideration because of the high cost of replacing EV battery systems. Consumers are also paying attention to software reliability, charging safety and potential liabilities associated with home charging systems.

Insurance requirements

EV buyers increasingly expect digital services, transparent coverage and insurance products that address vehicle technology and associated ownership risks. According to Faquet, insurers must provide vehicle protection while addressing uncertainties associated with EV technology.

He said EV insurance in Thailand could not be treated in the same way as conventional motor insurance for vehicles with a different powertrain. Risk pricing, product customisation and operational efficiency would be important in providing insurance coverage as the market develops.

Faquet said insurance could reduce barriers to EV adoption by making risks more predictable and ownership costs easier to assess, allowing consumers to evaluate the financial implications of switching to electric vehicles.

He said Thailand's EV market was moving beyond the early adoption phase towards wider adoption. However, further development would depend on vehicle affordability and charging infrastructure, as well as the capacity of related sectors, including insurance, vehicle repairs, charging safety and aftersales support, to accommodate the growing EV population.

As EV ownership becomes more widespread, insurance providers, repair businesses and other service operators will need to address the associated ownership requirements.