An estimated 100,000 electric vehicles now circulate in Ethiopia one year after restrictions on fossil-fuelled vehicles took effect. The vehicles test insurance rules written for petrol cars.
Federal transport authorities restricted fossil-fuelled vehicles a year ago to promote electric alternatives. Electric vehicles now account for less than five percent of the total fleet.
Belay Tulu, insurance director at the National Bank of Ethiopia, said the high cost of EV spare parts makes coverage at regulated minimum premium levels unsustainable. Insurers depend on spreading risk across large volumes.
The development highlights how existing financial frameworks struggle to accommodate the shift to electric vehicles.