Breaking the Dilemma of New Energy Vehicle Insurance: The "Vehicle-Battery Separation" Model Offers a New Solution

◎ Reporter Xu Xiaoxiao

Currently, new energy vehicle insurance faces the dilemma of “car owners complain about high costs, insurers call it unprofitable”—for new energy vehicle owners, the high cost of parts, especially the large proportion of repair costs for power batteries, drives up insurance quotes; for insurance companies, issues include high claim ratios, difficulty in damage assessment, and immature risk models.

To address this problem, Shenzhen recently proposed exploring a “vehicle-battery separation” model for auto commercial insurance products in specific scenarios such as urban transportation. Local property insurance institutions have already established special working groups for new energy vehicles to study the feasibility of implementing “vehicle-battery separation.”

Industry insiders say that the “vehicle-battery separation” model offers a new path for industry breakthroughs and reducing consumer burdens. By selling and insuring the vehicle and the power battery as separate objects, it is expected to significantly lower insurance coverage amounts and reshape premium pricing logic.

Exploring the “vehicle-battery separation” model

The so-called “vehicle-battery separation” means that the vehicle and the power battery are sold, managed, and insured as independent objects.

In traditional new energy vehicle insurance, the power battery, as a core high-value component, accounts for a large proportion of repair costs in total vehicle claims, and also faces residual value decline risks. In January 2025, multiple departments jointly issued the “Guiding Opinions on Deepening Reform, Strengthening Supervision, and Promoting High-Quality Development of New Energy Vehicle Insurance,” which proposed researching and exploring the “vehicle-battery separation” model for auto commercial insurance products.

In February this year, Shenzhen issued the “Action Plan for the Insurance Industry to Support Technological Innovation and Industrial Development (2026–2028),” explicitly exploring the “vehicle-battery separation” model for auto commercial insurance products in specific scenarios such as urban transportation.

“Shenzhen, as the first city in the country to introduce relevant regulations, has a pioneering approach.” Zhang Xiang, a researcher at the Automotive Industry Innovation Research Center of North China University of Technology, said that compared to integrated vehicle-battery models, the vehicle-battery separation technology has a lower risk of fire and explosion. This is mainly because the charging process is completed at battery swap stations, which have better protective measures and higher safety; additionally, after each battery swap, the battery undergoes systematic inspection to ensure it is in good condition.

Zhang Xiang believes that, based on higher safety, products based on vehicle-battery separation should receive lower damage assessment standards. As the number of battery swap vehicles increases, market demand for such insurance products is also growing. Continuing to use traditional new energy vehicle insurance models would put owners at a disadvantage, not only increasing operational costs for swap vehicles but also affecting the sales of swap vehicles.

Expected reduction in vehicle body insurance premiums

It is reported that the “vehicle-battery separation” insurance model has already been implemented in some regions. Moreover, Shenzhen has established a special working group for new energy vehicles to study the feasibility of implementing “vehicle-battery separation.”

The key impact lies in the pricing logic of new energy vehicle insurance. Xu Yuchen, partner and senior actuary at Yuchun Consulting, said that if the “vehicle-battery separation” model can be realized, with separate pricing and underwriting for the vehicle and the battery, the pure risk premium for the vehicle body in insurance could significantly decrease.

The head of a leading insurtech company, Cheche Technology, stated that under the “vehicle-battery separation” model, the battery assets are usually held by battery operators or vehicle enterprise asset platforms, while the owner purchases coverage for the vehicle body. Therefore, the insured value of the insured object decreases, and the coverage amount and rate basis for main policies like vehicle damage insurance will also decrease accordingly, which could theoretically alleviate the issue of “high premiums” faced by some new energy vehicle owners.

However, batteries are often separately priced through rental or service fees, and sometimes include battery warranty or insurance services. From a total cost perspective, owners’ expenditure structure may shift from “whole vehicle insurance costs” to a combination of “vehicle body insurance + battery service or warranty fees,” but the overall cost structure will become more transparent.

Clarifying responsibility boundaries is still necessary

Industry insiders say that to optimize the premium structure of new energy vehicle insurance, two major issues must be addressed: one is clarifying the responsibility boundaries among different parties to ensure clear risk units; the other is defining the scope of insurance coverage.

In traditional auto insurance, the entire vehicle is insured as a whole object. Under the “vehicle-battery separation” model, the vehicle and the battery are two relatively independent assets. Therefore, in case of accidents or battery performance issues, responsibilities must be clarified in advance.

For example, Cheche Technology’s business leader explained that damages to batteries caused by vehicle accidents are usually covered by auto insurance or responsible parties; issues related to battery quality or degradation are more likely to be borne by battery operators or warranty systems; risks arising during battery swapping or charging need to be borne by the swap station operators.

Regarding coverage scope, Xu Yuchen suggested that in the pricing models for battery-related risks, insurance pricing should revert to traditional evaluation dimensions based on driving behavior and driver characteristics, i.e., “from person and vehicle” factors, mainly including driver age, driving experience, accident history, and other indicators reflecting driving habits and risk preferences.

To further resolve claims disputes, Zhang Ruofeng, secretary-general of the Guangdong Bay Area New Energy Vehicle Industry Technology Innovation Alliance, proposed that the industry could establish a unified data sharing mechanism. In the “vehicle-battery separation” model, the battery is managed by the operator, and its full lifecycle data (such as charge/discharge cycles, health status, temperature, and maintenance records) can be continuously recorded. If standardization and sharing are achieved among automakers, battery operators, and insurance companies, a dynamic residual value assessment model for batteries can be gradually built. Through long-term accumulation of operational and accident data, the damage extent and repair necessity of batteries can be more accurately judged, ultimately forming an industry-wide reference system for battery residual value.