EV Fire Risk Insurance and What Canada Can Learn
As fires and explosions involving electric vehicles (EVs) continue to rise, South Korea is moving decisively to strengthen safety and compensation systems. Beginning in 2026, mandatory liability insurance will be required for EV charging facilities, covering injuries, property damage, fires, explosions, and even electrical shocks. Charging operators, apartment complexes, and other entities required to install chargers must comply or face financial penalties.
What makes this approach notable is its systems-level thinking:
- Coverage extends beyond traditional fires to include overheating connectors and electrical malfunctions that damage vehicles.
- A government- and manufacturer-funded compensation pool will step in when losses exceed private insurance limits.
- Compensation can reach the equivalent of tens of millions of dollars per incident, addressing large-scale or complex events.
Why this matters for Canada
Canada is rapidly expanding EV adoption and charging infrastructure in multi-unit residential buildings, public spaces, and workplaces. Yet, questions remain around:
- Who is liable when an EV fire occurs during charging or parking?
- Are building owners, charging operators, or vehicle owners adequately insured?
- How do insurers, fire services, and regulators align on risk and responsibility?
South Korea’s model highlights a potential path forward for Canada; one that integrates policy, insurance, manufacturer responsibility, and public safety rather than relying on fragmented coverage.
Education & Safety Implications
For Canadian fire services, regulators, insurers, and facility owners, this reinforces the need for:
- Clear risk allocation frameworks for EV charging environments
- Updated training and pre-incident planning for EV fires and electrical failures
- Evidence-based policy discussions on insurance minimums and backstop compensation mechanisms
As EV-related incidents become more frequent globally, proactive education and policy development will be essential to maintaining public confidence and protecting communities.
This is a conversation Canada should be having—now, not after the first major loss event.