Many car owners are surprised to find that insurance purchased through the BYD App can save them nearly 1,000 yuan. On social media platforms, numerous BYD vehicle owners have shared these bills — two major insurance companies quoted over 5,000 yuan, while BYD Insurance offered the same coverage for just over 3,000 yuan. However, scrolling through the comments, complaints about "slow claims processing" and "poor service experience" are equally prominent. With low prices on one side and a flood of negative reviews on the other, what exactly is happening with BYD Insurance?
Byd Company Limited's insurance arm derives its pricing power from a fully direct sales model. As of the end of 2025, all of BYD Property & Casualty Insurance's signed premiums came from direct channels, totaling approximately 2.897 billion yuan, with commission and brokerage expenses nearly zero. In contrast, the industry's average comprehensive expense ratio is around 25%, but BYD Insurance's ratio for 2025 was just 5.21%. Additionally, by leveraging exclusive data such as vehicle driving behavior and smart driving back-end systems, BYD can accurately identify low-risk users and offer them discounts. For example, one car owner's premium dropped from 5,300 yuan to 3,100 yuan — a reduction of about 40% — because they had no accidents throughout the year and received a driving behavior score of 92 points. In the first half of 2026, BYD Insurance's average premium per vehicle was 3,534.91 yuan, a year-on-year decrease of about 18%.
The downside of low prices is persistent pressure on the claims side. By the end of 2025, BYD Property & Casualty's comprehensive loss ratio had reached 97.28%, and it remained as high as 96.97% in the first half of 2026. For context, the normal level for the property insurance industry is around 70%. The high loss ratio stems from the nature of new energy vehicles: components like the three-electric system and intelligent driving parts are often replaced rather than repaired, and battery packs typically require full replacement when damaged, making repair costs significantly higher than for fuel-powered cars.
To control claim costs, insurance companies tend to tighten review standards on the claims side, leading to stricter damage assessments, tighter parts pricing, and longer review processes. These measures ultimately trickle down to the consumer. In February of this year, an incident in Shenzhen highlighted the issue: a husband's car accident claim saw four different staff members provide four different compensation amounts over six months — 20,553 yuan, over 50,000 yuan, 48,132 yuan, and over 50,000 yuan. The highest and lowest differed by more than double, and it took nearly seven months after the accident for the claimant to receive the first detailed repair list. This is not an isolated case. On social media, many car owners have encountered similar problems: errors in the online insurance purchase portal, a shortage of agents, being forced to use designated repair shops, and slow claims processing.
More critically, BYD Insurance only began its auto insurance business in 2024, relying primarily on its own authorized 4S dealerships for claims processing, without establishing a nationwide claims team. Its service network density and maturity lag behind traditional leading insurers. Notably, while BYD Property & Casualty achieved a net profit of 93.624 million yuan in 2025, turning a loss into a profit, its underwriting operations themselves remained unprofitable. Specifically, the comprehensive cost ratio was 102.49% in 2025 and 101.23% in the first half of 2026, both exceeding the 100% break-even point. The positive numbers on the books were actually driven by investment income. In other words, BYD Insurance is currently pursuing market expansion through a strategy of "slight underwriting losses funded by investment gains."
Wang Chuanfu once candidly stated that the new energy vehicle insurance industry is generally loss-making, primarily due to a disconnect between vehicle design and service processes. The deadlock in new energy vehicle insurance — where "car owners complain about high prices and insurers complain about losses" — must ultimately be resolved through data-driven pricing and a restructuring of the repair system. BYD's direct involvement as an automaker is a step in the right direction, but lowering premiums is only a small step; truly improving the claims experience is where the real challenge lies.
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