What Chinese EVs mean for your conversations with clients

Political circles rumbled last month, when Canada’s government announced a slashing of tariffs on Chinese-made electric vehicles (EVs) from 100% to 6.1% on the first 49,000 units, in exchange for China lowering tariffs on several Canadian agricultural products.

But for property and casualty (P&C) insurance brokers, the policy shift didn’t appear to cause many tremors. Although the P&C insurance sector will need to consider some specifics about covering the new market entrants, industry sources say the news is otherwise being taken in stride.

“I’m pretty happy to be completely agnostic to whatever choices [clients] make, and then we will help [them] navigate that complex world,” says Adam Mitchell, CEO of Mitch Insurance.

“That’s going to evolve quickly, because there’s going to [be] some sort of assumed clear rating [that will] prove out good or bad…These things aren’t always apparent on Day 1, so we’ll learn what the nuances are. [The objective should be] to just help the consumer live their life and manage them from financial risk.”

Canada’s federal government expanded its commitment to EVs on Feb. 5, announcing a return of rebate programs for new vehicles while scrapping a mandate to shift 100% of vehicle sales to EVs by 2035, replacing it with stricter overall auto emissions standards.

Related: Are EVs cheaper to insure than gas vehicles? It depends

Initial EV exports from China will likely come in the form of Volvos and Teslas because those brands have dealer and distribution networks in Canada, says Aaron Blackwood, senior sales manager at Mitch Insurance. Starting with established brands should make it easier for brokers to work with clients because those brands already have supply chains for parts and service in the event of claims.

“It’s [probably] not the BYD [vehicles at first]. That’s going to be a longer play. The distribution alone of those brands is a whole build-out,” he tells Canadian Underwriter. BYD (short for Build Your Dreams) is a buzz-fuelled Chinese EV car brand that grew out of an electric battery firm based in Shenzhen.

When BYD and other Chinese brands that aren’t yet sold in Canada begin to arrive, there may be concerns around whether service centres will have parts on hand and trained teams in place to ensure damaged vehicles get back on the roads quickly.

At that time, says Blackwood, there will be the issue of whether “a small fender bender is going to cost [a lot] because you don’t have someone to get the parts for this. Those factors will be in play.”

He adds he’s “put up a Bat Signal to a few of our insurer partners to get a little bit more of an understanding on to how they navigate new models in general.”

Related: Electric vehicle claims keep rising in Canada 

Plus, Blackwood’s preparing for how his team will navigate conversations with both clients and prospects around how their unique needs tie into the available coverages.

“We would factor in conversations around if it’s a new vehicle and there’s a depreciation waiver involved. That’s a great conversation. [Depreciation waivers] are something our carrier partners are going to offer longer-term,” he tells CU.

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He notes EVs in general experienced deep drops in depreciation during 2025. “That’s not specific to Chinese manufacturers,” he stresses. “There’s batteries involved, so you would want to consider ensuring that you have that depreciation [and coverage for] loss of use.”

“[If] we’re talking about a newer brand, and potentially delays in getting parts or service, we are going to want to continue to emphasize that [coverage for] access to a rental vehicle, the protection that you can purchase, and the increased limits available.”

Once BYD and other brands reach Canadian ports, “we’re going to be able to have a conversation to be ahead of this for our clients and prospects, and be able to say, ‘here’s the protection and coverage available that you want to keep in mind as you’re making this purchase,’” says Blackwood.

Related: Higher insurance costs a factor in Canadians’ hesitation to buy EVs

Phil Porado

Phil, an award-winning journalist with over 30 years of experience in financial topics, has been managing editor of Canadian Underwriter for more than three years.