How is my car insurance premium calculated?
The price of your car insurance is calculated using many factors, including your age, where you live and your driving history. But the car you drive also plays a big role.
New cars can be more expensive to insure because they’re more valuable. They could have higher repair costs and are more expensive to replace for insurance providers. However, they also tend to have better safety and security features, plus a lower risk of accidents and theft could also mean lower premiums.
Meanwhile, electric car insurance may be more expensive than a petrol or diesel engine model – even though it might be better for the environment. That’s because electric cars tend to have a higher price tag and higher repair costs.
But if you’re in the market for new wheels, the best way to check how expensive a car will be to insure is to check the car’s insurance group.
How does my driving history affect my car insurance?
Your age, how long you’ve had your licence and any penalty points or convictions are all taken into consideration when insurance providers calculate your premium. If you have a clean driving history, with a lengthy no-claims history, you could be rewarded with cheaper car insurance.
If you’re young or new to driving, you’ll face higher premiums compared to more experienced drivers. But you could get a more affordable quote by comparing low-insurance cars for new drivers.
Learner drivers | Young drivers | Over 60s | Over 70s |
|---|---|---|---|
£661[1] | £1,495[2] | £386[3] | £404[4] |
[1]51% of learner drivers could achieve a quote of up to £660.19 for their car insurance based on Compare the Market data in March 2025.
[2]51% of young drivers between 17-24 years old could achieve a quote of up to £1494.62 for their car insurance based on Compare the Market data in March 2025.
[3]51% of over 50s could achieve a quote of up to £386.00 for their car insurance based on Compare the Market data in March 2025.
[4]51% of over 70s could achieve a quote of up to £403.13 for their car insurance based on Compare the Market data in March 2025.
Obviously other factors affect the premium you’ll pay too, not just your age and experience.
How does engine size affect car insurance?
Broadly speaking, the bigger engine your car has, the higher the insurance premium. That’s because motorists with powerful high-performance cars are deemed more likely to be involved in an accident and bigger engines might be more expensive to replace or repair.
Small cars with smaller engines are likely to be cheaper.
How does security affect car insurance?
Alarms, immobilisers or other built-in security features are all designed to deter thieves. Installing these security measures could see your insurance provider offer you a cheaper premium.
Where you keep your car when it’s not in use will also affect your premium. If it’s parked on the street, it’s more likely to be targeted by thieves. But if it’s kept in a CCTV-operated car park or secure garage, it could be considered less of a risk by insurance providers.
How does the insurance group affect your car insurance premium?
All cars are placed into a car insurance group. These range from one to 50. Generally speaking, cars in low insurance groups are cheaper to insure, while models in group 50 are among the most expensive.
You can check which group your car is in using our car insurance group checker.
Cheapest Cars to insure (2024)
We’ve put together a list of some of the cheapest cars to insure in the UK.
This includes some of the bestselling cars that are allocated to the lowest car insurance group (group one), including new and used cars. Low insurance group cars can be the cheapest cars to insure for new drivers. However, the price of your insurance will depend on your personal details and driving history.
1. CITROEN C1
Vibe (2005-2008) and Airplay (2006-2007) models are in group one
With its compact size, the Citroen C1 makes for a great city runner. While it may be small, it’s smart with the space it does have and offers a modern look. Its 1.0-litre petrol engine means it doesn’t have a lot of power behind it, but it’s cheap to run.
2. FIAT PANDA
Active (2004-2008) and Active ECO (2008-2012) models are in group one
Thanks to its shape and design, the Fiat Panda is quite roomy for a hatchback. It’s a relatively cheap model, which means it’s fairly basic in terms of features, but offers good value for money.
3. FORD KA+
Studio model (2016-2018) is in group one
That plus has gone a long way. The Ford Ka+ puts that extra into everything. It’s more spacious and stylish than its predecessor, but remains an affordable, comfortable, albeit simple, car.
4. HYUNDAI i10
Premium, S, SE, SE Blue Drive and S Air models (2014-2016) are in group one
Good things sometimes come in small packages, and the Hyundai i10 certainly fits that description. Ideal as a small city car, this practical hatchback has a smart design and features plenty of modern tech, all at a competitive price.
5. KIA RIO
1 Air (diesel) model (2015-2017) is in group one
As a cheap family hatchback, the Kia Rio offers style and features that could go toe-to-toe with its rivals. Although it might not be the most exciting to drive, the diesel models in particular offer good fuel economy and it’s competitively priced. But what really sets it apart from the competition is the seven-year or 100,000-mile warranty that comes with all Kia models.
6. NISSAN MICRA
Visia 71 and Visia+ 71 (2016-2022) models are in group one
The newer Nissan Micra has a sharper, more edgy design than its predecessors, making it a more modern-looking hatchback. The Micra is known for being approachable, reliable and cheap to run – hence its popularity with driving schools. It’s a little bit tight for space in the back though.
7. SKODA FABIA
SE, SE Drive and Colour Edition MPI 60 models (2019-2021) are in group one
A great value-for-money hatchback, the Skoda Fabia is cheap to buy and to run. It also has plenty of room for a hatchback, with a comfortable and stylish interior. It might lag slightly behind some of its competitors in terms of modern features. But, if you’re on a budget, this could still be a great no-nonsense choice.
8. VAUXHALL CORSA
Expression (2006-2009) and Expression Ecoflex (2010-2011) models are in group one
A regular sight on UK roads, the Vauxhall Corsa is a popular choice for young drivers looking for a cheap first car. It’s easy to drive and thanks to its popularity, there are plenty of used Corsas on the market.
9. VOLKSWAGEN POLO
S, SE, Beats, Active and Match models (2018-present) are in group one
Another familiar model in the UK, the Volkswagen Polo is popular for a reason. It’s known for being roomy, comfortable and easy to drive. It may be a little more expensive to buy than other group 1 models on this list, but maintenance and repair costs tend to be economical.
10. VOLKSWAGEN UP!
MOVE UP model (2012-2016) is in group one
While the VW UP! might be small, don’t underestimate it. It’s smart, smooth and more spacious on the inside than you’d expect, and that small size makes it ideal for a city runaround car.
How can I compare car insurance quotes?
One of the quickest ways to make sure you get great value car insurance is to compare quotes. It’s simple to do and won’t take more than a few minutes of your time to generate quotes.
Give us some details about you and your car, and we’ll provide you with a list of quotes. Your results will start with the cheapest insurance available for you from our panel.
FAQs
Which car is the cheapest to insure in the UK?
The cheapest cars to insure in the UK will typically be those assigned to car insurance group 1. Broadly speaking, the lower the insurance group a car is in, the cheaper it will be to insure.
Bear in mind that different versions of the same car model can be placed in different insurance groups. For example, the Volkswagen Up! MOVE UP model (released from 2012-2016) is in car insurance group 1 while the Volkswagen Up! GTi 115 model (2018-2020) is in insurance group 17.
The insurance group your car is in depends on factors including the value of the car, the cost of repairs, the engine size and security and safety features.
Are old or new cars cheaper to insure?
Unfortunately, it’s not clear-cut which is cheaper to insure when it comes to new cars vs used cars.
In some ways, an older car can be cheaper to insure than a new car because they’re typically worth less, less attractive to thieves and they may be easier to repair. On the other hand, newer cars typically have much better security and safety features.
Are second-hand cars cheaper to insure?
Second-hand cars are not necessarily cheaper to insure. A car’s insurance group depends on several factors including value, repair costs, engine size, safety and security features.
There are second-hand cars in low insurance groups and second-hand cars in higher insurance groups. Similarly, you can buy safe and economical cars brand new that are in low insurance groups or high-performance, high-value brand-new cars in high insurance groups.
What's the cheapest insurance group?
Group 1 cars are the cheapest to insure, although the price you pay for your car insurance premiums will be influenced by other factors including your age, postcode, mileage and driving history..
Julie is passionate about delivering a great customer experience and rewarding people for saving on their insurance through our loyalty and rewards programme. She’s spoken to the media, including outlets like Sky News, about car and home insurance, as well as our Meerkat rewards scheme.
Rebecca Goodman is a freelance financial journalist who specialises in insurance, personal finance and consumer affairs.
Our content is written by a Compare the Market expert, backed by data and enhanced by AI. Find out how we ensure accuracy and quality in our Editorial Guidelines.
