<p><strong>Speaker 0</strong>: <span>to discuss the development of the electric vehicle market and what it means for insurers and insurance brokers. I'm joined now by Mark WADA. He is head of motor commercial lines at Aviva Mark. So just how rapidly is the E V market evolving? I</span></p> <p><strong>Speaker 1</strong>: <span>think it's safe to say it's moving at pace. Um, if you go back to 2020 compared to end of 2022 the the number of electric vehicles on the road tripled.</span></p> <p><strong>Speaker 1</strong>: <span>Um, and as an insurer, it means we're having to move at pace with that to make sure our customers are happy. We've had the government commitment to banning the sale of new petrol and diesel vehicles by the end of 2030. So it means that we're having to invest time and and money as a as an insurance business to make sure that we're We're keeping pace with that change and make sure we stay relevant for our customers.</span></p> <p><strong>Speaker 0</strong>: <span>And and I suppose if there's more cars, there's got to be more infrastructure that's coming out as well. So what? What are some of the issues there?</span></p> <p><strong>Speaker 1</strong>: <span>A lot of it comes down to the investment, so if you look at at the moment. There's about 42,000 charging points on a around the UK network</span></p> <p><strong>Speaker 1</strong>: <span>to support that that ban of, um, petrol and diesel vehicles and that that transition to electric in 2030 there needs to be at least 300,000 by by 2030 so</span></p> <p><strong>Speaker 0</strong>: <span>it's evolving pretty rapidly. But how revolutionary are the changes then that are gonna face you as insurers, uh, insurance brokers and and the end client? Given this backdrop, I think</span></p> <p><strong>Speaker 1</strong>: <span>it's an interesting one from an insurance perspective, because what what we have to remember is that electric vehicle is essentially a four wheel vehicle operating on a UK road. So from an insurance product perspective,</span></p> <p><strong>Speaker 1</strong>: <span>the the product that is in place today meets the requirements of that vehicle. Um, in terms of if you look at the way way we price risks</span></p> <p><strong>Speaker 1</strong>: <span>motor insurers, we tend to use that rearview mirror and that the claim to the past tell us what the future is going to be. That claims profile could change. Um, so we we have to make sure that we we constantly review the data that we have at our hands at the moment to try and predict the future. But we are. We are seeing some of those dynamics change, and it it It's not really going to cause us too many issues, though, because, as I say the we've still got a a human being sitting behind a steering wheel, making decisions,</span></p> <p><strong>Speaker 1</strong>: <span>and we will still continue to see motor claims occur. And we'll handle those in the same way that we have done and price in the same way.</span></p> <p><strong>Speaker 1</strong>: <span>But in a couple of instances,</span></p> <p><strong>Speaker 0</strong>: <span>I mean, if you get a fire in electric vehicle, I presume it's rather different from how you'd handle a fire in a in a petrol or a diesel car.</span></p> <p><strong>Speaker 1</strong>: <span>Luckily, the numbers that we see are really low at the moment. We if if you look at the research available, it's it's a very small number of vehicles. But if if a vehicle does catch fire, then it's a very different type of fire. I think the the ignition you you with a petrol vehicle. We have to have that that something that's going to ignite that fire where an electric vehicle,</span></p> <p><strong>Speaker 1</strong>: <span>the number of chemicals in in a battery, if that ignites it it can create over 100 different gases that are coming out of out of that battery. Some, some are poisonous to to humans, so</span></p> <p><strong>Speaker 1</strong>: <span>it comes down to having an expertise on hand that can can handle those. And I think for me, in terms of that claims process where we see those fires, it's</span></p> <p><strong>Speaker 1</strong>: <span>how How do we? How do we handle those claims? Um,</span></p> <p><strong>Speaker 1</strong>: <span>that that claims process is broadly similar, but what? What you have to do is have have skilled technicians in play, have some real expertise that they they know what they're doing when when they're coming into contact with a battery, they know how to handle the battery in terms of storage, in terms of repairing it. It it brings a different level of expertise.</span></p> <p><strong>Speaker 0</strong>: <span>And what about the underwriting knowledge? Because again, presumably underwriting something like a petrol station is very different from underwriting somebody who says I've got a whole lot of charging points.</span></p> <p><strong>Speaker 1</strong>: <span>So if you speak to our property underwriters, the underwriting process is is very similar. What it comes down to the question. The key question for them is how they manage that risk. So</span></p> <p><strong>Speaker 1</strong>: <span>where where are the electric charging points placed. What are they placed up against? How how close are they to buildings to combustible materials? Where? So it's a very similar process, but it really does come down to a conversation with the broker or the customer in terms of if we if we can get in at the start of the conversation when those those, um, charging stations have been designed, we can pass on some of our knowledge and actually help them design</span></p> <p><strong>Speaker 1</strong>: <span>at a station which is going to be safe, and and one that we know we can rely on and we can underwrite.</span></p> <p><strong>Speaker 0</strong>: <span>And how much is there an international angle on this? Because a lot of your clients must have fleet of vehicles that don't just stay in the UK. They go to Ireland, they go to France, they go to Spain.</span></p> <p><strong>Speaker 0</strong>: <span>How how important is it to be able to cover them in all of those different</span></p> <p><strong>Speaker 1</strong>: <span>jurisdictions? Yes, so many of our customers will will travel on certainly on onto the continent. So our our policy, as I said earlier, it's it's still a a same vehicle operating and in the same, So the insurance requirements are the same, the vehicles being used in the same way. Um, the fact that it's an electric vehicle doesn't doesn't really change that. The the charging infrastructure may change because, uh, even if you look at, um, in the UK</span></p> <p><strong>Speaker 1</strong>: <span>the the types of charges, um, out there there's different adapters for For each vehicle there is, there's something called type two which has become the standard across Europe. But it it varies by by vehicle, um, so that that's something that I think we we we we work with the manufacturers to make sure that we understand that those processes and and we can then inform our customers when when it comes to giving them advice on what vehicles they should be transition towards.</span></p> <p><strong>Speaker 0</strong>: <span>And what are you learning in this process as it is, a sort of move to E. V. S? Um, not least because you, as a a Viva are a large corporate. You've got some pretty publicly stated aims of trying to be net zero by 2040. Most people are going for 2050. So what have you learned yourselves? That you can apply to this market?</span></p> <p><strong>Speaker 1</strong>: <span>I mean, with with that commitment to be net zero. We've We've made the commitment, our own fleet of vehicles, that by 2025 it will either be completely electric or or plug in hybrid. So we we've seen that process. Um</span></p> <p><strong>Speaker 1</strong>: <span>uh, all of our drivers sign up to that, and actually, the the performance of them is is very similar to what? What we'd expect. Um, I think for me, it does. Does come down to that that risk management process again, it's the the one thing I think we tend to underestimate is the familiarisation with the vehicle. When when you're given the keys to A for a new vehicle to a driver</span></p> <p><strong>Speaker 1</strong>: <span>in the past that the vehicle they've inherited will will be the same same sort of performance one they had before where the the the dynamics of a electric vehicle the acceleration is very different. The braking is different. So we've got to make sure from a risk management perspective that we are, we are given training on how to use that vehicle.</span></p> <p><strong>Speaker 0</strong>: <span>And how serious a player are you in the E v market today? Um, how serious would you like to be seen? As in, say,</span></p> <p><strong>Speaker 1</strong>: <span>345 years time. It's a good question. So at the moment our market share across personal lines and commercial is between 10 and 12% By 2030 we want to be the number one insurer of electric vehicles. So we feel that we need to</span></p> <p><strong>Speaker 1</strong>: <span>have a have a market share of about 14% to be to get to that number one position. Um, and I think from a from a commercial perspective, I think in the market today there is a perception that we are entirely comfortable with electric vehicles. Nothing could be further from the truth. Um, our underwriting appetite is there to add electric vehicles. We cover a large number already for some of our key commercial customers. They're transitioning at a rate of 1000 vehicles a year into electric</span></p> <p><strong>Speaker 1</strong>: <span>that our policies are set up. Our underwriting processes are set up for that. Already, we've invested heavily in our claims model, so we own our own repair network. So they've been upskilling all of their technicians over the last couple of years, so they'd make sure they've got got got a skilled technician at every every repair shop. Um, so I think we're We're well placed already in that electric vehicle market, so we we have a stated ambition to be number one.</span></p> <p><strong>Speaker 0</strong>: <span>Aviva is known as an insurer, but you've also got a very big asset management to the business. So what are they up to? Is it aligned with what your goals</span></p> <p><strong>Speaker 1</strong>: <span>are?</span></p> <p><strong>Speaker 1</strong>: <span>Yes, they are. Um, if you look recently, there was a an investment made of 100 and 10 million into a business called Connected Curb.</span></p> <p><strong>Speaker 1</strong>: <span>And that's that's been set up to</span></p> <p><strong>Speaker 1</strong>: <span>install about 100 and 90,000 charging points across the UK, some of it across our own real estate. Um, so that's one really good example of of how we're we're doing more than selling insurance. This is about how how can we invest in the community and the infrastructure to make sure that our customers, which are always at the centre of what we do, that that they're they're getting the full, full access to the full power of a</span></p> <p><strong>Speaker 0</strong>: <span>And so finally, if brokers want to know more about this rapidly evolving market, how can Aviva help?</span></p> <p><strong>Speaker 1</strong>: <span>So I think there's a number of ways we can help we we have a electric vehicle hub online, and it's at the moment it's driven primarily at customer, uh, personalised customers, but</span></p> <p><strong>Speaker 1</strong>: <span>that that applies equally to to commercial customers so brokers can access there they they can use. We had a sustainability roadshow on for brokers recently, so that's available on on the Aviva broker website. But also I think the most important thing comes out of people. It's speaking to underwriters. We've got our sales and distribution team. We've got got our claims team, our risk engineers.</span></p> <p><strong>Speaker 1</strong>: <span>They're all on hand to give advice.</span></p> <p><strong>Speaker 0</strong>: <span>We have to leave it there. Mark, Thank you for joining</span></p> <p><strong>Speaker 1</strong>: <span>us. Thank you.</span></p>