Half of insurance quote requests were declined outright
As Chinese electric and hybrid vehicles gain a foothold in British showrooms — with models like the Jaecoo 7 briefly claiming the title of the UK's bestselling new car — a quieter obstacle has emerged in the insurance market. Insurers, lacking the claims history and repair data needed to price unfamiliar risk, are declining coverage or charging significantly more, turning a vehicle's purchase-price advantage into a hidden long-term cost. It is a pattern as old as automotive markets themselves: the arrival of the new is always met first by the caution of those who must calculate its consequences.
- Half of all insurance quote requests for Chinese EVs are being declined outright by major UK insurers, leaving some buyers with only one or two providers willing to write a policy.
- Premiums for Chinese models average £255 more per year than equivalent European or Korean petrol cars, with some nearly double — quietly erasing the savings that made these vehicles attractive in the first place.
- Insurers are caught in a data vacuum: without a claims history for vehicles they have rarely covered, they cannot price the risk, and without pricing the risk, they will not build that history.
- Chinese brands are nonetheless accelerating into the UK market, with BYD and Jaecoo registrations surging in early 2026, sharpening the contradiction between rising demand and constrained insurability.
- Manufacturers are negotiating directly with insurers and pointing to the eventual normalization that followed Japanese and Korean brands' market entry — but that trajectory offers no relief to drivers paying elevated premiums today.
A 27-year-old in Hampshire shopping for insurance on a new Jaecoo 7 discovers what many British drivers are encountering for the first time: half the insurers he contacts simply say no. Of five major providers tested, only Aviva and Admiral will write him a policy — at £1,103 a year, nearly double what he would pay to insure a comparable petrol Skoda Karoq.
This is the hidden friction in Britain's Chinese car boom. Brands like BYD, XPeng, and Jaecoo have arrived with compelling price tags — the Jaecoo 7 hybrid SUV became the UK's bestselling new car in March 2026 — but the insurance industry, still learning how to price vehicles it barely understands, is creating a cost that can quietly cancel out the savings on offer.
Research by car sales platform Carwow tested five major insurers against four Chinese models. Axa declined all four. Hastings Direct covered only one. Across the board, half of quote requests were rejected outright. When policies were available, the premiums told their own story: the XPeng G6 averaged £936 annually against £639 for a petrol Hyundai Kona of similar specification; the BYD Seal U ran £876 against £730 for a Kia Sportage.
Insurers describe a straightforward problem. Without claims history for these vehicles, they cannot calculate accurate risk. Chinese EVs and hybrids tend to cost more to repair after crashes, and parts supply chains remain underdeveloped. As Stephen Kennedy of financial information service Defaqto puts it, it is a chicken-and-egg dilemma — data requires policies, and policies require data.
Manufacturers point to history for reassurance: Japanese and Korean brands faced similar skepticism when they first entered the British market, and pricing eventually normalized. Oliver Lowe of Omoda and Jaecoo UK is working directly with insurers to accelerate that process. But the normalization could take years, and for the driver who saved £3,000 on a purchase price only to face elevated premiums across the life of ownership, the gap between a car's affordability and the cost of protecting it remains one of the market's sharpest contradictions.
A 27-year-old man in Hampshire shopping for insurance on a new Jaecoo 7 would face a puzzle that many British drivers are encountering for the first time: half the insurers he contacts will simply say no. Axa won't quote him at all. Hastings Direct will cover the car only if he switches to a different model. Direct Line declines two of the four vehicles he's considering. Only Aviva and Admiral will write him a policy—and when they do, the annual premium lands at £1,103, nearly double what he'd pay to insure a comparable petrol-powered Skoda Karoq.
This is the emerging friction point in Britain's automotive market. Chinese car makers—BYD, XPeng, Jaecoo, and others—have arrived with compelling economics. The Jaecoo 7, a hybrid SUV, became the UK's bestselling new car in March 2026, earning the nickname "Temu Range Rover" for its affordable appeal. Chinese brands are selling in rising numbers. But the insurance industry, still learning how to price risk on vehicles it barely understands, is creating a hidden cost that can erase the savings these cars promise.
Research by Carwow, a car sales platform, tested the market by requesting quotes from five major insurers for four Chinese models: the hybrid Jaecoo 7, the XPeng G6, the BYD Seal U, and the Skywell BE11. The results exposed a stark divide. Axa declined all four. Hastings Direct offered coverage on only one. Direct Line and Admiral each rejected two vehicles. Only Aviva agreed to insure all of them. Across the board, half of the quote requests were declined outright.
When policies were available, the premiums told their own story. The XPeng G6 cost an average of £936 annually—well above the £639 figure for a petrol Hyundai Kona with similar specifications. The BYD Seal U ran £876 compared to £730 for a petrol Kia Sportage. The Skywell BE11, available from only Aviva in the study, cost £685 against £638 for a petrol Ford Kuga. Across all Chinese models tested, insurance averaged £901 per year—roughly £255 more than equivalent petrol vehicles from Europe, the US, or South Korea.
Insurers cite a straightforward problem: they lack the data to price these cars accurately. Stephen Kennedy of Defaqto, a financial information service, describes it as a chicken-and-egg dilemma. "If they haven't sold policies for these types of vehicles, they don't have the data to be able to work out how much they should be charging," he explains. Chinese EVs and hybrids tend to be more expensive to repair after crashes, and parts supply chains remain underdeveloped. Hastings Direct notes that some Chinese brands are still low-volume in the UK, with repair infrastructure still taking shape. Axa simply states it lacks sufficient data to cover newer Chinese marques.
Iain Reid of Carwow emphasizes that the problem extends beyond price. Limited availability means drivers cannot shop around effectively, and for some models, insurance may become impossible to obtain at all. "It's still harder to get insurance quotes for newer Chinese models than for more established European and Japanese alternatives," he says. The constraint is particularly acute because it arrives precisely when Chinese car sales are accelerating. The Society of Motor Manufacturers and Traders reported large rises in registrations of brands like BYD and Jaecoo in April 2026, as overall car sales climbed nearly a quarter above the previous year.
Manufacturers acknowledge the friction. Oliver Lowe, head of product at Omoda and Jaecoo UK, notes that his company is working directly with insurers to reduce costs. He draws a historical parallel: Japanese and South Korean brands faced similar skepticism when they first entered the British market, yet insurance availability and pricing eventually normalized. "Anything that's risk-based is slow to change and adapt to new challenges very quickly," he says. "That's completely understandable. It's risk for them."
But that historical comfort offers little solace to drivers buying Chinese cars today. Insurers say costs will fall as repair data accumulates and parts supply chains mature—a process that could take years. For now, the buyer who saves £3,000 on the purchase price of a Jaecoo 7 may find that advantage erased by higher insurance premiums over the life of ownership. The gap between the car's affordability and the cost of protecting it remains one of the market's starkest contradictions.
Notable Quotes
For some motorists, this could make some models impossible to insure at all— Iain Reid, Carwow
It's a bit of a chicken and egg situation. If they haven't sold policies for these types of vehicles, they don't have the data to be able to work out how much they should be charging— Stephen Kennedy, Defaqto
The Hearth Conversation Another angle on the story
Why are insurers so reluctant to cover Chinese cars when they're willing to insure vehicles from Japan and South Korea?
It's not reluctance born from prejudice—it's the absence of a track record. Insurers need repair costs, claims data, and parts availability to price risk. Japanese brands took decades to build that history. Chinese cars arrived last year.
But surely they can estimate based on the vehicle's engineering and safety ratings?
They could, but insurance is priced on what actually happens in the real world, not what engineers predict. A car that looks safe on paper might have repair costs that surprise everyone once it hits the road in volume.
So the Jaecoo 7 being the bestselling car in March—that should help, right? More data coming in?
Eventually, yes. But that data takes time to collect and analyze. The insurers writing policies now are essentially guessing, which is why they're charging so much or declining altogether.
Is this just a temporary market friction, or could it actually slow Chinese car adoption?
For price-conscious buyers, it's a real problem. You save £3,000 on the car and lose it in insurance over three years. That changes the math entirely.
What would speed up the process?
More volume, more claims, more repair shops learning how to fix these cars. The manufacturers are trying to help by working with insurers directly, but ultimately it's a waiting game.
Do you think insurers are being overly cautious?
Possibly. But they're also protecting themselves. Repair costs for EVs are genuinely higher than petrol cars, and they don't yet know how Chinese vehicles will perform in British accidents and weather. Caution isn't unreasonable—it's just expensive for the customer.