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Car insurance groups explained ukiah

The need for an annual car insurance quote is one of the frustrating aspects of car ownership. Yes, we know we need to be covered, but why can’t our car insurance company be relied on to give us the best deal each year? Instead, annual insurance premiums seem to rise inexorably, with companies taking advantage of ‘automated renewal’ notices to hike prices safe in the knowledge that most drivers are too busy to pay much attention.

Cynical? Us? Well maybe, but we know we’re not the only ones to share that view. It’s why the car insurance comparison websites are thriving, as sensible drivers take the opportunity to shop around for car insurance online.

• Cheapest cars to insure

Shopping around is a good way to save money on a car you already own, but if you know running costs are going to be an issue upfront, you’ll need to start thinking about the insurance group rating of any potential purchase before you set your heart on it.

Car insurance groups are how the insurance companies set your premiums, and they’ve been a part of the motoring scene for nearly 50 years. It’s actually been against the law to drive without insurance since the 1930s, but insurance groups were not introduced until the 1970s, when the industry decided create an easily understood rule of thumb for which cars are most expensive to repair and replace, and/or most likely to be involved in costly accidents due to their performance.

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Nowadays, each new model derivative (and most sold since the 1970s) has an insurance group rating applied by the Association of British Insurers (ABI). The original group ratings were from 1-20, but since 2009 the current much broader insurance group ratings of 1-50 have been used. That means there’s scope to award different ratings to different specs and trims within model ranges. If you want a good illustration of that that can mean, consider the Audi A3 line-up which starts at insurance group 18 for the basic 1.6-litre diesel three-door, but shoots all the way up to insurance group 46 for the sporty S3 Cabriolet. As you would expect, the higher the insurance group rating, the higher your premium is likely to be.

How are insurance groups calculated?

The ABI works in conjunction with vehicle security and repair expert Thatcham to compile the insurance classifications for UK cars. The two main areas of research are how much damage a car sustains in a collision and how cheap and easy it is to repair after an incident. The experts factor in a number of points when setting an insurance group, including:

  • • Parts availability and price: For repair purposes, Thatcham uses a list of 23 commonly damaged parts for pricing, in the same way the Treasury's basket of goods is used to calculate inflation.
  • • Performance: The manufacturer-quoted 0-62mph acceleration figure and top speed of a specific car are taken into account.
  • • Repair costs: Thatcham performs its own low-speed crash tests (chiefly a 15km/h impact) and engineers determine the cost of parts and labour to return a car to its pre-accident condition.
  • • Price when new: The vehicle list price is used to calculate the cost of a settlement if the car is written off.

Data for these comes from Thatcham's own tests, although in the case of parts and labour these prices are sourced directly from the vehicle manufacturer.

Once all of these factors are taken into account, Thatcham then classifies each new car into the 1-50 insurance groups, and then a security rating is given. At the top end, cars with excellent security features, such as can move into a lower insurance group, while vehicles with poor security are placed into a higher group and therefore the cost of insurance is increased.

What else determines a car's insurance group?

Thatcham also tests vehicle security, according to the New Vehicle Security Assessment programme. Theft is still one of the chief reasons for an insurance claim, so the security of a vehicle will qualify it for a lower insurance premium. Thatcham breaks down cars with the following suffixes after a car's insurance group number:

  • • E: Exceeds the security requirement for the type of car, so the insurance group rating has been lowered.
  • • A: Acceptable level of security for the type of car.
  • • D: Doesn't meet security requirements for the type of car, so the insurance group rating has been raised.
  • • U: Unacceptable standard of security. An insurer may insist on upgraded aftermarket security before they agree cover.
  • • P: Provisional. Not enough data is available at the time of launch to classify the car. This will likely be amended once a new car has become available for Thatcham to evaluate.
  • • G: Grey import. Thatcham only tests cars that are officially sold in the UK, so imports are only evaluated at a price that the insurer sets.

As mentioned above, security ratings can increase or decrease a car's overall insurance group. A group 8 car with an excellent security rating will be moved down to group 7, and rated as 7E. Conversely, a group 8 car with a poor security score will be moved up to group 9, and rated as 9D.

Another way for a car to improve its insurance group rating is by offering a high standard of safety. If autonomous emergency braking is fitted as standard, for example, a vehicle can drop one group once it's been tested by Thatcham. Other advanced active safety aids can also have a positive effect on the insurance grouping of a car, as long as they are standard-fit equipment.

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Manufacturers play a further part in determining insurance costs. High parts prices or labour rates at dealerships are taken into account when deciding a car's grouping. So if one manufacturer's dealers are more expensive, its cars could creep up the scale - even in cases where cars are mechanically similar. For example, the Audi A3 and Skoda Octavia have similar running gear, but the Audi has insurance group ratings from 18-45, while the Octavia ranges from 13-30. 

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Different versions of the same car will also be in a range of insurance groups, as engine performance and trim level affect premiums. A base level Ford Fiesta Studio fitted with the 1.25-litre engine is way down in group 5, but the same car in Titanium X trim with the 125bhp 1.0-litre EcoBoost engine is in group 16.

UK insurance groups history

When the group system was established over 40 years ago, cars were classified in just nine insurance groups. In 1992, this was increased to 20, but with ever-increasing diversity in the new car market, the current 50-group system was introduced in 2006.

Vehicles from the 10 years prior to the new system being introduced – 1996 or later – are classified according to the same 50 groups as new cars are today. For cars built before 1996, premiums are calculated based on an insurer's own experience.

What do insurance groups mean to me?

Broadly speaking, the higher the insurance group, the more expensive insurance will be. You can check out the cheapest cars to insure here - these are all cars with a rating in group 1-3, so should be affordable to insure.

However, it’s not quite as simple as that. Insurers aren’t bound to follow the ABI guidelines that Thatcham sets, and will use their own judgement and experience to decide how much to charge customers. For example, a stereotypical ‘boy racer’ car will attract a higher premium than one that’s more staid and sensible – even though the two vehicles might be in the same insurance group.

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This can hit young drivers especially hard - the few cars that a 17-year-old can afford to buy and run will have their insurance costs pushed up even further as the insurer will have past experience with these cars being involved in collisions.

That's why it’s important that insurance groups aren’t the only factor when choosing a new car. Be sure to obtain actual insurance quotes rather than simply comparing on insurance group - you might be surprised how much two similar cars can differ on insurance costs. And of course, research heavily. It could be worth taking a small hit in terms of insurance cost for a car that will save money elsewhere - with excellent fuel economy, for example.

How much do you consider insurance cost before choosing a car? Let us know in the comments below...

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If you’ve been using carwow, there’s a chance you’re considering a brand new set of wheels. Obviously this is great but, before you dive head first into the buying process, take a step back to really think about the costs that are an unfortunate part of running a car.

You have weekly petrol fill-ups, maintenance costs, and parking fees to name a few. Thankfully, they are all relatively straight forward. There is one cost, however, that may prove to be a bit trickier to wrap your head around: insurance.

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How is it worked out?

A myriad of factors are considered when insurance companies calculate their premiums. More often than not, the insurance group a car falls into will be used to get the ball rolling. Before you sign on the dotted line, it’s worth checking which insurance group your car falls into – just so you aren’t hit with any unexpected quotes when it comes to sorting out the cost of your policy.

Prior to 2009, there were 20 insurance groups into which all UK cars could be placed. In order to more accurately band together cars with similar levels of specification, this number has increased to 50.

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Who decides the groups?

The unenviable task of sorting out all of the cars on sale in the UK into these 50 different groups is allocated to the Group Rating Panel. The GRP is made up of various representatives from the insurance industry, as well as members of the Association of British Insurers and the Lloyd’s Market Association. Research for the GRP is conducted by the Motor Insurance Repair Research Centre (Thatcham).

A number of factors determine what car goes where. The general rule of thumb is the more expensive a car is to buy, the higher the insurance group it will fall into.

Small superminis that are relatively cheap – such as the Volkswagen Up, Audi A1 and Vauxhall Corsa – will tend to fall between groups 1-10. Fire-breathing monsters like the Lamborghini Aventador and Ferrari F12 will, you guessed it, be in group 50.

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Is it all about purchase price?

The price of a new car is not the be-all and end-all when it comes to determining its insurance bracket. The GRP will also take into account things like the cost of repairs, the car’s performance capabilities, its desirability to thieves and the security features it has installed.

Cost of repairs is one of the most important factors when determining which insurance group a car will be placed into. This is largely because repairs make up half the money paid out in motor insurance claims. If you purchase a car with a lengthy repair time that requires expensive spare parts to be sourced, you can bet your bottom dollar the car will find itself placed in a higher insurance group.

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How fast a car will travel from 0-60mph is another factor used to determine a car’s insurance group. The thinking here is the faster a car goes, the more likely it is to be involved in an accident. It’s also believed that powerful cars, when involved in a crash, generate more expensive claims.

Cars thought to have heightened security measures in place will naturally attract a lower insurance group. Features that add to a car’s level of security in the eyes of the GRP include immobilisers, alarms, and having the car’s Vehicle Identification Number (VIN) visibly etched into the glass of one of the windows.

All of these things help the GRP figure out which insurance group your car falls into. Remember, the insurance group does not determine the final insurance premium you will have to pay. Insurance companies only use insurance groups as a starting point before factoring in your location and driving history.

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Can I get a better deal?

There are ways you can reduce your premium if you’re choosing a more expensive car. Completing a Pass Plus driver training programme, accepting a higher excess, paying your policy upfront rather than in instalments, or removing the requirement for a courtesy car in the event of an accident will all help reduce the amount you pay.

You could even take part in a ‘black box’ insurance scheme. This means your insurer installs a satellite tracker in your car so data on how you drive can be recorded and sent back, helping them get a better idea of the risk associated with your driving style. If you show yourself to be a safe, sensible driver your policy goes down, if it detects more extravagant driving it can push your premium up.

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Age is also something that insurance companies will consider. Unfortunately, young drivers are involved in a disproportionately high number of accidents and insurers make up for this by charging young drivers an arm and a leg. Elderly drivers also see a premium increase because they are deemed riskier than middle-aged drivers.

So, there you have it. Hopefully we’ve helped clear up any questions you may have had with regards to car insurance – if not, pop your query in the comments section and we’ll get you an answer.

What next?

Head over to our car configurator to see how much you could save on your ideal next car or, for more options, take a look at our deals page to see our latest discounts. For an in-depth explanation about the different types of insurance you can get, read our plain English guide to insurance. For a list of cars currently on sale with free insurance offers, check out our article.

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The cost of insuring your car will be influenced by a number of factors, one of which is the insurance group that your vehicle falls into. Every make and model of car on UK roads today will have been assigned to a group based on certain criteria - from the engine size to the cost of replacement parts - and these are numbered from 1 to 50. Cars with a lower group number are the cheapest to insure, and those in the top end are the most expensive.

Insurers will use these numbers as a guide when calculating premiums. If there are other factors likely to increase the cost of your car insurance, a way to reduce the overall amount could be to opt for a car in a lower group. For example, a new driver with limited experience who is yet to acquire a no claims history will be among the most expensive to insure, but this cost could be reduced by purchasing a car in group 1. Cars in this group also tend to be less powerful, with smaller engines, so could be a safer option for inexperienced drivers.

How are insurance groups decided?

Car insurance groups are decided by the Group Rating Panel, which meets on a monthly basis and is made up of representatives from the insurance industry, including the Association of British Insurers (ABI) and Lloyds Market Association. Its decisions are based mainly on data provided by the Motor Insurance Repair Research Centre (Thatcham), which takes into account a range of vehicle characteristics, listed below.

Repair time

How easy are the parts to come by if the car is damaged, who can fit them and how long will it take? A specialist paint job, for example, can increase the group allocation.

Parts prices

A list of 23 common parts from one manufacturer is compared with that of another. Those that generally cost less are allocated to a lower group category.

Value

How much was the car worth when it was new? The price of a new car is often used to gauge that of a replacement or repair.

Performance

Cars with more powerful engines, capable of bigger speeds and acceleration, are deemed a greater risk, and will therefore end up in a higher group.

Security

What was the car fitted with as standard that will lessen the chances of it being stolen? Does it have an alarm, immobiliser, glass etching or coded audio equipment?

It is the cost of repairing the car in the event of an accident that is said to have the biggest influence in determining the group - the cost of repairs account for more than half of the amount paid annually for car insurance claims, according to the ABI. High-performance or luxury models have bigger repair costs, and are therefore placed in a higher group.

The list of groups is intended to be used as a guide only, and an insurer may still apply its own ratings if it prefers. Most, however, will class cars in a very similar fashion, combining this information with a driver's claims history and risks to calculate a premium.

Which insurance group is my car in?

By finding your vehicle in the list below, or a similar model, it might be possible to determine roughly the insurance group your car belongs to. Bear in mind that certain factors, such as modifications, could cause this outline to vary.

Groups 1-10

Dacia Sandero, Vauxhall Corsa, VW Up!

Groups 11-20

Audi A3, Honda Civic, Mini Countryman

Groups 21-30

BMW 3-Series, Land Rover Defender, Seat Leon

Groups 31-40

BMW 5-Series, Ford Focus ST, VW Touareg

Groups 41-50

Audi R8, Jaguar F-Type, Porsche 911 Carrera

Taking two extremes, the VW Up! is a small city runabout that falls into a low category and will be among the cheapest to insure, ideally suited to a new driver or someone on a budget. By contrast, the Jaguar F-Type is in the highest category, and will carry one of the biggest premiums.

The list shows that it is not just exotic sports cars such as Ferrari or Lamborghini occupying the highest groups, but also more common makes of car.

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