Examination of factors influencing accident frequency and severity of Electric Vehicles (EVs) vs Internal Combustion Engine Vehicles (ICEV)

This paper presents a comprehensive analysis of the frequency and severity of accidents involving electric vehicles (EVs) in comparison to internal combustion engine vehicles (ICEVs). It draws on extensive data from Norway from 2020 to 2023, a period characterised by significant EV adoption. We examine over two million registered EVs that collectively account for 28 billion kilometres of travel. In total we have analysed 139 billion kilometres of travel and close to 14,0000 accidents across all fuel types. We supplement this data with data from the Highway Loss Data Institute in the US and Association of British Insurers data in the UK as well as information from the Guy Carpenter large loss motor database. A thorough analysis comparing accident frequency and severity of EVs with ICEVs in the literature to date has yet to be conducted, which this paper aims to address. This research will assist actuaries and analysts across various domains, including pricing, reserving and reinsurance considerations. Our findings reveal a notable reduction in the frequency of accidents across all fuel types over time. Specifically, EVs demonstrate a lower accident frequency compared to ICEVs, a trend that may be attributed more to advancements in technology rather than the inherent characteristics of the fuel type, even when adjusted for COVID. Furthermore, our analysis indicates that EVs experience fewer accidents involving single units relative to non-EV and suggests a decrease in driver error and superior performance on regular road types. Reduction in EV accident frequency of 17% and a change in the distribution of average severity with higher damage costs and lower injury costs leading to an overall reduction of 11% However, it is important to note that when accidents do occur, the number of units involved as a proxy for severity involving EVs is marginally higher than those involving ICEVs. The average claim cost profile for EVs changes significantly with property damage claims being more expensive and bodily injury claims being less expensive for EVs. Overall, our research concludes that EVs present a lower risk profile compared to their ICEV counterparts, highlighting the evolving landscape of vehicle safety in the context of increasing EV utilisation.