Car insurance groups and how they affect the cost of insurance
The cost of your car insurance reflects the risk your insurer thinks you pose. One of the main considerations an insurer looks at is the type of vehicle you are insuring, from its overall value to its performance and power.
Each vehicle is given a rating from 1 to 50, with Group 1 vehicles being the lowest risk and the least expensive to insure. Obviously Group 1 vehicles generally have a lower value, a lower specification, and smaller engines -- whereas Group 50 vehicles are usually fast, high-performance models with a high value. So, if you want to reduce your insurance premiums, you could consider replacing your car with a vehicle that falls into a lower insurance group.
How are car insurance group ratings determined?
Several factors contribute to deciding the insurance group of a car. The Association of British Insurers says that more than 50% of the money paid out in car insurance claims is for the cost of vehicle repairs, so this has a big impact on how insurance groups are defined. Insurers will look at how much the vehicle would cost to repair in the event of a claim; the cost of parts; and how long it would take to repair – as this can have an impact on labour costs and potential replacement vehicle hire costs.
The insurer will also assess the vehicle's value when it is brand new, and look at its performance – since high performance cars tend to attract more frequent insurance claims.
They will also look at how well-protected the vehicle is from thieves. Cars with security features as standard pose less risk to insurers. They will therefore take into account devices such as alarms, immobilisers and high security locks on doors, as will visible Vehicle Identification Numbers (VIN), glass window etching, locking devices for removable items such as alloy wheels, and coded audio equipment.
How can you find out which car insurance group a car falls into?
The Motor Insurance Repair Research Centre, or Thatcham, provides the ABI with 70% of the information used to establish the insurance group of every private motor car registered in the UK. This information is taken from Thatcham's assessment of a vehicle, including the ease of vehicle repair and the level of security, and used by the Group Rating Panel to decide which car insurance group a car should fall into.
Before you buy a new car you can check its group at Thatcham's website to help estimate the cost of insuring it.
It's worth knowing, however, that these groupings are only recommendations, and insurers can set their own groupings if they wish – although they are unlikely to be dramatically different to the ABI groupings.