Newsletters
Risk Central
Digital EditionEV Charging Infrastructure Emerges as Major Risk Factor Despite Lower Fire Rates
Although electric vehicles are significantly less likely to catch fire than their gasoline-powered counterparts, up to 30% of these rare but severe incidents are linked to charging, highlighting a critical and emerging risk in the EV revolution, according to an article by Allianz Commercial.
Global EV sales exceeded 17 million units in 2024, pushing electric vehicles above 20% market share for the first time, according to the International Energy Agency. Projections suggest 200 million EVs could populate roads by 2030, necessitating massive charging infrastructure expansion. Accompanying this expansion is an array of risks, according to Allianz Commercial.
While EVs are statistically 61 times less likely to catch fire than gasoline vehicles, the consequences prove more severe when incidents occur. Between 15% and 30% of EV fires link to charging activities, with individual incidents generating substantial losses, the insurer said.
The financial consequences of these losses can be substantial, as seen in a May 2025 incident in California where a fire originating from a lithium-ion system during charging caused an estimated $275,000 in damages.
Maritime incidents underscore the severity potential. The cargo ship Morning Midas burned for nine days before sinking in June 2025, carrying 3,000 vehicles including 70 fully electric and 700 hybrid cars. Industry losses for the shipment reached hundreds of millions of dollars, Allianz Commercial noted.
Critical Failure Points Create Complex Risk Portfolio
Charging stations introduce multiple vulnerability vectors that traditional risk models struggle to capture, according to Allianz Commercial.
“The riskiest moment in an EV’s life concerning battery risk isn’t driving—it’s charging,” said Rafael Rioboo, regional head of risk consulting for Allianz Commercial’s Iberia region.
Thermal runaway represents the most dangerous scenario, where overheated lithium-ion batteries enter self-sustaining temperature cycles.
“Thermal runaway doesn’t wait for you to act—it ignites, escalates and overwhelms,” Rioboo explained. “It can lead to fires, explosions and the release of heavy metals and toxic chemicals like carbon monoxide and hydrogen cyanide.”
Allianz Commercial identified seven primary failure modes for EV charging infrastructure:
- Equipment fires that can spread to vehicles and buildings.
- Property hazards from vandalism and natural disasters.
- Liability issues including electrocution and accidents.
- Product defects damaging user property.
- Environmental contamination from fires and inadequate stormwater management.
- Cybersecurity vulnerabilities in smart charging systems.
- Regulatory non-compliance resulting in fines or legal action.
Grid Infrastructure Faces Unprecedented Stress Test
The convergence of mass EV adoption with aging electrical infrastructure creates systemic risks that extend beyond individual charging incidents, the article noted.
“We’re plugging cutting-edge technology into century-old infrastructure and not always asking whether the grid can actually cope,” said Ciro Mirengo, senior liability risk consultant at Allianz Commercial.
Peak charging demands coinciding with reduced solar output threaten grid stability. “Our power grids were not originally designed or tested for this kind of simultaneous load,” Mirengo noted. “Unless we invest in smarter, more resilient systems, while fostering close collaboration among all stakeholders, we could be setting ourselves up for a cascade of failures.”
Read the full article here. &
