Car insurance groups
The price you pay for your car insurance will, at least in part, be based on which one of 50 car insurance groups it falls into, as decided by the official Group Rating Panel. Cars in group 1 are the cheapest to insure, and those in group 50 are the most expensive. For example, a Peugeot 206 will fall in group 7, making it relatively cheap to insure, whereas a BMW Z4 will fall in group 44 and so will cost rather significantly more to insure, all other things being equal.
We'll go over how these categories are decided and how, whichever car you buy, you can make sure you get the best deal on your car insurance policy.
In This Guide:
- What are insurance groups?
- How are cars categorised in groups?
- Cheapest cars to insure
- How to ensure you get the best deal on your insurance
- What do I need to compare car insurance?
What are insurance groups?
The official Group Rating Panel (GRP), made up of members of Lloyds Market Association (LMA) and the Association of British Insurers (ABI), have set out 50 different groups into which every car falls.
Insurance groups are used by insurance providers as a guideline to work out the cost of premiums offered to customers. Having a car belonging to a cheaper group does not necessarily mean that you'll be able to get a cheap car insurance policy (and vice versa). Various other factors like the statistical likelihood of an accident occurring based on things like the age of the driver also come into play, as well as the status of the potential policy holder's no claims discount.
Bear in mind that these groups only apply to cars built to UK specifications, and so imports, kit cars and some classic cars will have to undergo a Single Vehicle Approval (SVA) test in order for the price of insurance to be worked out.
How are cars categorised in groups?
The GRP uses research from the Motor Insurance Repair Centre (Thatcham) in order to work out the specifications by which each car is categorised.
Various factors are involved in the categorisation of cars, including (but not limited to):
- The price of the vehicle when bought new.
- The cost of and ease of sourcing replacement parts.
- The cost of repairs, as well as the time involved.
- The performance of the car, including engine size.
- The safety and security features of the vehicle.
The price of repairs and replacement parts are a big factor, especially given that research from the ABI suggests that these costs account for over 50% of the amount that the insurer pays out in the event of a claim.
The performance is another important consideration since a sports car that drives faster and accelerates particularly quickly is viewed as higher risk by insurers than a small car with a top speed of 80mph.
Just as keeping your car in a garage or using anti-theft devices like steering wheel locks can work to improve the cost of your insurance, having a car with already built-in security measures will push it down into a lower group, again reducing costs. A good alarm system or a visible Vehicle Identification Number (among other things) will work to reduce to probability of theft.
Cheapest cars to insure
The cheapest cars to insure in the UK are usually the same cars that are the cheapest to buy. Cars that grouped into the lower insurance groups tend to be smaller vehicles, with smaller engines and thus less powerful models than those in higher insurance groups.
Here is our pick of some the cheapest cars to insure in 2020, with the lowest insurance group available for each model:
- Hyundai i10 (Group 1)
- Nissan Micra (Group 1)
- Skoda Citogo (Group 1)
- Volkswagen Polo (Group 1)
- Ford Fiesta (Group 2)
- Kia Rio (Group 2)
- Seat Ibiza (Group 2)
- Toyota Yaris (Group 2)
- Vauxhall Corsa (Group 2)
- Fiat Panda (Group 3)
Please note that within each car model there will be different versions of that model that you can get – for example different size, age, engine etc. The insurance groups noted for these models apply to the version with the smallest engine – some more powerful versions of these car models will fall under higher insurance groups.
How to ensure you get the best deal on your insurance
Knowing what car insurance group your vehicle falls into is crucial to working out how cheap your car insurance will be, but it is not the be all and end all of cost judgement. Driving a car in group 1-5 can still cost a lot if, say, you're an 18 year old who's just passed their test or if you have a list of previous motoring convictions.
Similarly, if your car belongs to a higher group, you can still take steps to keep the cost of your insurance policy down.
Firstly, security is crucial. As mentioned above, if you can demonstrate to the insurer that you are keeping your car safe and secure and reducing the risk of theft, your premiums will fall.
You might also want to opt for a different kind of insurance policy to save money. Black box policies are a great option, particularly for younger drivers who want to avoid the sky high premiums they are offered all too often.
With a black box policy, a device installed in your car will track your mileage, speed and other information about your driving in order to build up a profile and, if you consistently drive responsibly, you'll get discounted premiums.
You could also consider named driver insurance, where you share a policy with another. So long as whoever is down on the policy as a named driver is not actually the main driver, this can be a great way to save a bit of money.
No Claims Discount
Building up a no claims discount is one of the best ways to watch your premiums fall year after year, often by up to 75% over a five year period. Insurers like to reward safe drivers, and the no claims discount is the perfect example of this in action.
Compare Car Insurance
No matter what car insurance group your chosen vehicle falls into, and no matter what type of policy you're after, by comparing car insurance with Money Expert, you can be sure that you'll have your pick of the best quotes on the market.
What do I need to compare car insurance?
Comparing car insurance with Money Expert is quick, easy, and could save you hundreds on your annual premium. All you need to is provide us with a few details about yourself and the car that you’ll be driving. You will then be presented with a list of quotes from a range of insurance providers, based on your age, driving history and the model of your car. Simply choose a quote at a price that suits you, finalise the purchase and start saving.