China’s EV Boom Saddles Its Auto Insurers With Chronic Losses

China’s giant electric vehicle insurance market is flailing. Losses are piling up, as companies’ risk models haven’t kept up with changes in vehicle economics and driver behaviors.

The country now has tens of millions of electric cars on its roads, and sales are rising at a rapid clip. Chinese insurers have found that new energy vehicle owners — which tend to be younger on average — are about twice as likely as owners of gasoline-powered cars to file claims. The repair costs are also significantly higher.

But despite EV drivers paying anywhere from 20% higher to double the premiums for ...