Listed insurance companies ramp up their strategies to ease the "immediate concerns" in new energy vehicle insurance

In 2025, although publicly listed insurers’ property insurance subsidiaries are still making rapid progress in new energy vehicle insurance business, at the same time, the “near-term worries” for new energy vehicle insurance have eased somewhat, and major insurers are at a critical turning point from “underwriting losses” toward “breaking into profitability.” However, while the “near-term worries” have eased, “long-term concerns” have quietly begun to emerge. Continuous breakthroughs in intelligent connected-vehicle technology are not only reshaping the way people travel and commute, but also posing disruptive challenges to the traditional auto insurance industry. As intelligentization accelerates across the board, how should new energy vehicle insurance develop?

Accelerating Cost Optimization

According to data released on March 31 by the China Society of Actuaries and the China Banking and Insurance Information Technology Management Co., Ltd., in 2025, China’s insurance industry underwrote 43.58 million new energy vehicles (including 41.81 million passenger vehicles and 1.77 million freight trucks), an increase of 12.48 million year over year, up 40.1%; premium income was 190 billion yuan, providing risk protection coverage of 159 trillion yuan; underwriting losses were 5.6 billion yuan, with losses reduced by 0.1 billion yuan year over year.

As can be seen, although the underwriting scale of new energy vehicle insurance is continuously expanding and underwriting losses are decreasing, it still has not achieved profitability on the underwriting side.

How have the new energy vehicle insurance businesses of leading insurers performed? Over the past few years, new energy vehicle insurance has been a keyword at earnings and performance briefings by listed insurers. Zhang Daoming, a member of the Party Committee of PICC Property and Casualty Insurance, Party Committee Secretary, and acting responsible person, said that, overall, new energy vehicle insurance faces three major challenges: first, the claim frequency of new energy vehicles is high—significantly higher than that of fuel vehicles; second, there is a shortage of socialized repair channels, so vehicle repair costs are relatively high; third, both the share of personal injury claims and compensation standards are showing an upward trend, with the average amount of claims per case increasing.

“All of these keep the compensation pressure for new energy vehicle insurance at a high level. However, in the face of challenges, we actively leverage advantages in areas such as data, pricing, channels, and costs, and have already built leading strengths in the field of new energy vehicle insurance.” Zhang Daoming said that, at present, some positive factors have emerged in new energy vehicle insurance. Influenced by multiple factors such as an increase in the proportion of used cars, improvements in driving behavior habits, and progress in advanced driver-assistance technologies, the claim frequency for new energy vehicles is showing a downward trend.

Taiping Property and Casualty’s premium income for new energy vehicle insurance in 2025 reached 25.017 billion yuan, accounting for 22.6% of the company’s overall auto insurance business, up 5.6 percentage points year over year. “It should be said that the growth rate of new energy vehicle insurance is higher than the growth rate of the company’s overall auto insurance business. This benefits from the company’s overall strategic layout in the new energy sector in the earlier period.” said Chen Hui, general manager of Taiping Property and Casualty. Through exclusive operations with automaker brands, technology-enabled loss adjustment to reduce claims and losses, and further strengthening of the service system, the company has made a significant improvement in the overall business costs of new energy vehicle insurance.

New Technologies Bring New Variables

As new energy vehicle technology evolves, new market variables are starting to appear. The Outline of the “Fifteenth Five-Year Plan” proposes accelerating the development of strategic emerging industries such as intelligent connected- new energy vehicles, and solidly promoting key technology innovations such as intelligent driving. The intelligent connected-new energy vehicle industry has already gradually entered a new stage of scaled implementation and commercial operations. This is undoubtedly a key variable affecting the ecosystem of the entire auto insurance industry. Recently, Beijing has announced that it will take the lead in launching the development and application of commercial insurance for intelligent connected-new energy vehicles.

The first impact of technological change is on insurance companies’ core pricing system. Zhang Xin yuan, head of a consulting organization called Ke Fang De, said that traditional auto insurance pricing relies on historical claim data, driver behavior, and so on, but the risk factors of intelligent connected vehicles undergo fundamental changes (for example, human errors are reduced, but new risks such as system failures and network attacks become more prominent). Insurers need to redesign pricing models, but lack data support, making it difficult to quantify new risks. At the same time, intelligent connected-vehicle technology iterates quickly, and risks change dynamically, further increasing pricing difficulty.

Misalignment of pricing models is only one side of the challenge; the responsibility determination process in claims is also becoming more difficult. Responsibility allocation for accidents involving intelligent connected vehicles involves multiple parties, including drivers, automakers, software providers, and sensor manufacturers, yet current laws and insurance clauses have not clearly defined how to assign responsibility. “If an accident occurs in an intelligent driving mode, should responsibility be attributed to improper actions by the vehicle owner, system defects, or third-party interference?” Zhang Xin yuan gave an example, noting that currently there is a lack of a basis for assigning responsibility, which may lead to claim disputes and rising costs. In addition, issues such as non-uniform technical standards, regulatory lag, and differences in consumer acceptance further exacerbate operational uncertainties for insurers.

In Zhang Xin yuan’s view, to cope with these challenges, insurance companies need to cooperate with automakers and regulatory authorities to promote data sharing, build dynamic pricing systems, and explore new insurance products based on actual driving performance.

Li Xiumei, a reporter from Beijing Business Daily

(Editor: Qian Xiaorui)

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