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Borrowers Want To Know: Can I get vehicle protection for my EV?
Gas prices these days, am I right? Not that you need the stats if you’ve made a trip to the gas pump lately, but here they are:
- On March 6, the price of regular gasoline soared to over four dollars. Days later, the average price of diesel inflated by over five dollars.
- By June 3, the price of regular gasoline hit $4.70—the highest recorded average price for gas in U.S. history.
- Gas prices are up more than 55% in June 2022 compared to the same time last year.
With gas prices out of control, more consumers than ever are looking into buying hybrid and electric vehicles (HEVs).
As the federal government steps up plans to move to 50% electric vehicles by 2030, consumers are getting on board. In fact, HEV sales have experienced record growth for the last five years. Year-over-year HEV sales for January were up 37.4%.
As more electric vehicles hit the highways, many consumers have questions about the logistics of owning an electric vehicle. One question they’re asking is whether they can get vehicle protection for their hybrid or electric vehicles. The answer: Yes, as long as they own an HEV that qualifies.
Offering your borrowers vehicle protection for their electric vehicles can help generate non-interest income for your institution and build loyalty with borrowers who value this protection for their HEVs.
Vehicle Protection for HEVs
Electric vehicles are essentially very advanced, very expensive computers comprised of a full set of electrical components, monitors, and operating systems. EV owners who do not have a manufacturer’s warranty or some type of vehicle protection run the risk of having to pay for costly repairs on an incredibly complex piece of technology.
Though HEVs are touted for being designed to last a long time without repairs, like any car, they can still stop working out of the blue. Replacing a monitor alone can cost thousands of dollars. This is something borrowers need to be prepared for and offering vehicle protection products can help give them peace of mind.
Protection for Used HEVs
While the interest in buying HEVs is higher than ever, semiconductor shortages for these vehicles are still disrupting new inventory supplies. This means many consumers are turning to the used vehicle market to purchase HEVs. Obtaining vehicle protection for their electric vehicle is a good investment for many used HEV owners. The best time to buy this coverage is when the manufacturer’s warranty has expired to minimize overlap and ensure they’re only paying for what they need.
Conclusion
While your account holders’ needs may vary, the one thing that remains consistent is they want products and services that bring value to their lives.
To help financial intuitions deliver a product that is relevant and timely in today’s economy, SWBC’s Financial Institution Group is pleased to introduce healthCAR—a new, budget-friendly way for members to protect their vehicle after their manufacturer’s warranty expires with easy online enrollment and no mileage restrictions. This coverage is available for HEVs, excluding Tesla models.
healthCAR is a simple, affordable, month-to-month, vehicle service contract that can help generate non-interest income for your credit union and address the needs of a wide segment of your borrower base, including direct and indirect borrowers, members with auto loans at other institutions, recently paid-off loans, and members with vehicles past the manufacturer’s warranty.
Stephen Lang
Stephen Lang is the Northeast Regional Vice President for SWBC. With a focus on our Total Solution Strategy, Stephen works with financial institutions providing them consultative advice around risk management, technology, and ways to generate non-interest income. Before joining SWBC, Stephen spent nearly 10 years in the insurance industry, including time with large national consulting firms such as Risk Strategies and Arthur J Gallagher. He currently holds Life & Health and Property & Casualty insurance licenses and the CEBS designation.
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