Insurers, Don’t Pass the Buck: Own EV Batteries or Let OEMs Handle Them Safely!

Electric vehicles (EVs) are the future, but their high-voltage (HV) batteries are complex and potentially hazardous, especially in total loss or cash loss claims. Insurers must stop handing over EVs with HV batteries to salvage buyers to minimize losses. Instead, they should either take full ownership of these batteries or let experts—OEMs or authorized recyclers—handle them to prevent catastrophic risks.

Why HV Batteries Are Risky for Salvage Buyers

• Invisible Threats: An HV battery may seem fine externally, but internal chemical Too reactions or unseen damage can cause fires, explosions, or toxic leaks. Expert assessment is critical, yet insurers often skip OEM evaluations due to costs—like transportation to specialized facilities—that they can’t justify in total loss claims. Insureds resist settlement deductions for such assessments, leaving batteries untested and dangerous

• Inexperienced Hands: Salvage buyers typically lack the skills or equipment to safely handle HV batteries. Transferring EVs with these batteries risks improper repairs or misuse, potentially leading to devastating accidents and loss of life or property

• Regulatory Red Flags: The Battery Waste Management Rules, 2022 classify HV batteries as Waste Batteries once discarded by the user. In total loss claims, even undamaged batteries should be considered discarded when handed to salvage buyers. This triggers a mandate to transfer them to OEMs or authorized recyclers. Insurers should avoid bypassing this risk

What Insurers Must Do

• Own It or Delegate to Experts: Fully manage HV battery recycling with strict compliance, or hand them over to OEMs, who are built for safe handling under Extended Producer Responsibility

• Scrap Smart, Cancel RCs: For total loss EVs, cancel the Registration Certificate (RC) and scrap the vehicle through salvage buyers without the HV battery to prevent misuse

• Recycle Right: Ensure HV batteries go to OEMs or authorized recyclers for environmentally sound disposal, safeguarding lives and the planet

A Wake-Up Call for Insurers

Minimizing losses by offloading HV batteries to salvage buyers could cost far more—lives, property, and your reputation. Step up, own the process, or let OEMs take the wheel. Let’s keep safety and compliance first in the EV era!