Money Matters Team

Cheap insurance cars

By Money Matters Team 12/06/2012

Research by Sainsbury's Bank Car Insurance last year revealed that, within the space of one year, some 1.3 million motorists quit driving altogether due to the rising costs of motoring.

A lower car insurance premium could help, and changing the car you drive can achieve this. Our research found that around 3.5 million people opted to downgrade their car.*

How does it work?

Insurance companies use a vehicle classification system to group every make and model on the market. A Group Rating Panel - made up of members of the Association of British Insurers and the Lloyds Market Association - meets monthly to categorise every new car.

Until recently there were 20 groups, but as of 2007 there are now 50. This change was made in order to categorise vehicles more accurately, with other cars that have similar characteristics.

The category that a car falls into can have a real impact on your car insurance premium. As a guide, Groups 1 to 5 tend to include the cheapest cars to insure (though there are other factors to consider), so buying a car in these groups could result in a saving. Looking for cheap insurance cars? Here is a sample from the bottom 5 groups.** 

Manufacturer Model Group
Chevrolet Spark 1.0i Base 1
Fiat Panda 1.1 Active ECO 1
Vauxhall Corsa 1.0 ecoFLEX Expression 1
Volkswagen Fox 1.2i Base, Urban 1
Citroen C1 1.0i VT 2
Ford Ka 1.2 Studio, Metal 2
Nissan Pixo 1.0i Visia, Acenta 2
Toyota Yaris 2
Ford Ka 1.3 TDCi Zetec 3
Peugot 107 1.0i Urban Lite, Urban 3
Smart Fortwo coupé 3
Toyota iQ 1.0i Base 3
Fiat Panda 1.2i Eleganza 4
Skoda Fabia 1.2i 60PS S 4
Suzuki Alto 1.0i SZ2, SZ3 4
Volkswagen Polo 1.2i 60PS Various 4
Citroen C3 1.1i VT 5
Ford Fiesta 1.25i 60PS Studio 5
Peugeot 207 1.4 HDi 70PS Urban, S(AC) 5
Vauxhall Corsa 1.3 CDTi ecoFLEX S/S 5

**Information correct as of June 2012

What criteria are used?

The factors that car insurance companies take into account when categorising a car include:

  • Cost of replacement or repair – are parts hard to come by, or expensive due to import costs?
  • Relationship between performance and risk – for example, if the car is a high performance model, do the statistics show that this model is more likely to attract drivers with a tendency to speed?
  • Statistical data relating to theft, accident or malfunction – for example, does the car have ABS, or come with built-in security devices?
  • Tax band – a car’s tax band relates to its green credentials. The lower a car’s CO2 emissions, the lower the tax band and insurance grouping it tends to fall into.

In general, the cheaper the car is to buy, the cheaper the insurance will be. A pricey Maserati Gran Turismo, for instance, falls into the highest Insurance Group (50) and will be expensive to insure. A comparatively cheap, small car with a small engine, such as a standard Chevrolet Spark, is in the lowest Insurance Group (1) and so will be cheap to insure.

Further advantages

As well as benefiting from a reduced car insurance premium, there are additional financial incentives for choosing a car in a lower insurance group.

  • The original purchase price is likely to be lower.
  • The car will almost certainly have low engine cc, which means lower petrol consumption.
  • You will probably pay less road tax.

If you’re concerned about the price of staying on the road, understanding how your current or next car is categorised will help you to control costs. Check out the Car Pages website for more useful information about the 50 insurance group categories.

Before acquiring any new car, you can get a car insurance quote to find out how this choice will affect your premium. Choosing a car that falls into a lower group could make all the difference between affordable motoring and being driven off the road altogether.

*ICM interviewed a random sample of 2022 adults aged 18+. The interviews were conducted via an online omnibus survey between 13th May and 15th May 2011. Surveys were conducted across the country and the results have been weighted to the profile of all adults. ICM is a member of the British Polling Council and abides by its rules. Further information available at the ICM website.

This Money Matters post aims to be informative and engaging. Though it may include tips and information, it does not constitute advice and should not be used as a basis for any financial decisions. Sainsbury's Bank accepts no responsibility for the opinions and views of external contributors and the content of external websites included within this post. Some links may take you to another Sainsbury's Bank page. All information in this post was correct at date of publication.