Power modules play a key role in traction inverters for vehicle electrification applications. The harsh automotive operating environment is a big challenge for power modules. The paper highlights the challenges for power modules usage in electrified vehicles (xEVs), and proposes a design verification procedure for such application in order to ensure the reliable operation under all conditions. First, power modules operate in all climate zones and are exposed to a wide ambient temperature range underhood from -40°C to 105°C. A typical automotive power module should therefore withstand a junction temperature from -40°C to up to 175°C without exceeding its safe operating area (SOA), e.g. avalanche breakdown voltage, maximum current, and thermal limit. Second, an inductive induced high voltage spike could be generated during the power semiconductor fast switching at high voltage and high current conditions. The voltage clamping capability is usually required to prevent power semiconductor breakdown under such high voltage spike. Moreover, IGBT short circuit capability is desired to allow adequate time to trigger protection once a short circuit occurs in the motor windings or the inverter. The power module in xEV application is used as an example to show the proposed design verification process including 1) wide temperature range of operation, 2) voltage clamping capability, and 3) short circuit capability.