By Tom Clarke, Director of Motor Strategy, LexisNexis Risk Solutions
However, UK motor insurance providers are being asked to price vehicles they have never insured, repaired or settled claims on, with limited visibility of how construction quality, safety systems and component availability will impact repair costs. Underprice and loss ratios may deteriorate as claims experience emerges. Overprice and insurance providers risk ceding a fast-growing segment to competitors willing to take a different view of the risk.
At the same time, ADAS (advanced driver assistance systems) specifications vary significantly across models and trim levels. Insights from the recent China Auto Show underline how rapidly Chinese manufacturers are introducing new models into global markets, with specifications that shift from one vehicle to the next and are frequently unverified at the point of quote.
Pricing problems
This lack of visibility has real consequences. Premiums for some Chinese EV models are running at close to triple those of equivalent European vehicles[iv], reflecting the uncertainty insurance providers face when they cannot accurately assess risk.
This is against a backdrop of motor claims severity inflation at 7% in 2026[v] partly driven by the growing complexity of repairing vehicles with advanced electronics and EV powertrains. Of the 36.7m cars on the road, c.12% are now hybrid or fully electric where costs to repair are significantly higher.[vi] Chinese EVs compound the claims conundrum further as parts for repairs can be difficult to source meaning higher average claim costs and greater pricing uncertainty.
Addressing the data gap
Two developments are beginning to address the data gap from different directions. VIN-level vehicle intelligence through LexisNexis® Vehicle Build gives insurance providers insight into exactly how a specific vehicle is equipped — including the presence, specification and performance of specifications. Where fitment varies significantly across models, that level of specificity matters.
Thatcham Research is also working directly with Chinese OEMs to build a deeper, UK-specific evidence base around safety and repairability — most notably through its Vehicle Risk Rating (VRR) score. By making that intelligence accessible through LexisNexis Risk Solutions, a more powerful connected ecosystem is taking shape; one that combines OEM insight, independent validation and vehicle-level intelligence into a single, usable framework for insurers.
Affordability Pressure
Along with pricing accuracy, affordability of insurance as part of the total cost of car ownership is also a major consideration. Chinese EVs enter the market at attractive price points but for consumers, the true cost calculation factors for insurance and premiums for Chinese EV models remain significantly elevated as a direct consequence of the data gap and repairability uncertainty described above.
OEMs are increasingly aware of this dynamic, recognising that a competitive purchase price can be undermined by high running costs, and that insurance sits at the centre of that equation.
To help address these challenges, insurance providers need to understand not just what people drive but also how they drive.
Driver scoring from connected car data
In 2025, LexisNexis Risk Solutions announced a collaboration with Kia Europe to embed driving safety scoring insights in the Kia App — enabling drivers to better understand their behaviour, while giving participating insurers, with consumer consent, the ability to incorporate that data into pricing models. This enables more personalised insurance offerings and the potential for lower premiums to help reduce the total cost of ownership.
Kia has now deployed this driving safety scoring capability across all European markets. The feature is optional for drivers, yet adoption has reached approximately 35% of users, equating to around 400,000 drivers engaging with their safety score.
That level of voluntary engagement points to strong consumer appetite for greater visibility into driving behaviour and, by extension, greater control over what they pay for cover.
This also addresses affordability: helping drivers reduce their risk, improve their behaviour and ultimately lower their premiums, while contributing to safer roads overall.
As the UK car parc with older vehicles being driven longer and newer Chinese EVs entering the market, integrating driver intelligence alongside robust vehicle-level data will be essential — both to give insurance providers the confidence to price these vehicles competitively and to give consumers a realistic route to bringing those costs down.
Closing the gap
Chinese EVs are no longer a niche segment. They are becoming an increasing presence in the UK car parc, and the actuarial community requires data infrastructure that reflects that reality. The insurance providers best placed to compete in this market will be those who build that foundation earliest rather than waiting for claims experience along to provide answers for them.
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