Increasing electric vehicle (EV) sales could have implications for strata insurance as building infrastructure needs to be upgraded and risks become better understood, an industry report says. 

“Due to the risk factors associated with the integration of electric vehicles into strata schemes, there is likely the potential for strata insurance premiums to be affected, as EVs continue to emerge and gain popularity,” Strata Community Association (SCA) says. 

SCA last week released the second of two reports on electric vehicle challenges in strata, as more people live in apartments and demand for EVs increases, while almost all older buildings haven’t been built with the level of electrical infrastructure sufficient to support the additional load that EV charging creates. 

“Common facilities, limited space, ageing infrastructure and diverse shared ownership structures in strata can create unique hurdles for EV ownership that aren’t commonly faced in standalone homes or other areas,” the report says. 

SCA says insurance issues need to be considered given potential risk factors around the vehicles and charging technology. These include having outdated electrical wiring or inappropriate charging infrastructure. 

The EV market is still in its infancy in Australia and New Zealand, and there’s a perception the wider insurance industry hasn’t yet “caught up” in factoring the vehicles into pricing models due to a lack of data and incidents on which to base prices, the report says. 

There also aren’t specific underwriting questions for EVs in strata nor data fields to capture information, but policyholder disclosure duties are important for insurers in taking on risks. 

SCA says strata managers should ensure information about EVs and charging infrastructure is disclosed so that the strata scheme isn’t potentially in breach of requirements. 

“As the insurance industry continues to develop its response to the integration of EVs into strata, SCA will continue to work alongside federal and state governments to ensure that they are aware of the experience of strata insurance consumers, and work towards alleviation of the potential cost pressures of increased strata insurance premiums,” the report says. 

Other areas that insurers may identify in looking at the risks include electrical shock, theft or vandalism involving chargers, maintenance, business interruption in mixed use buildings, personal injury and product liability.