Mandatory insurance for e-bikes would cost NSW hundreds of millions of dollars more than the vehicles return in benefits, a review by the state’s Productivity and Equality Commission has found.

By contrast, measures that improve rider safety through education and enforcement would deliver a $55 million net benefit, the commission says.

The review assessed six policy options to address concerns about safety, accountability and compensation associated with e-micromobility devices.

It found the costs of administering, enforcing and complying with insurance schemes would outweigh the benefits, imposing net costs on NSW of between $470 million and $1 billion.

“The analysis found that mandatory insurance schemes are unlikely to be the most effective response,” the commission said.

The review concluded e-bikes have a safety profile broadly similar to bicycles, and most people seriously injured in e-bike incidents already have access to protection, including compulsory third party insurance when motor vehicles are involved.

Education and enforcement is the only policy option that would improve safety while preserving the transport, health and environmental benefits of e-micromobility devices, the review found.

The net benefit of $55 million reflects fewer crashes and injuries, relatively low implementation costs and the preservation of transport benefits by avoiding increases in the cost of riding.

The commission recommends preventative steps, including expanded public education campaigns promoting safe and lawful riding; targeted enforcement of road rules and device standards; and increased visibility of enforcement activities in high-risk areas.

Productivity and equality commissioner Peter Achterstraat said: “E-bikes and other e-mobility devices are becoming an increasingly important part of the NSW transport system ... NSW already requires insurance for higher-risk e-micromobility activities, including shared schemes and food delivery riders.

“But for private e-bikes, the main concerns are illegal devices and unsafe riding. The most effective response is to target these through education and enforcement.”