Car insurance is one of the biggest ongoing costs of owning a car in the UK, and for younger drivers in particular it can cost more than the car itself. The average UK car insurance premium was around £600 in 2025, but this varies enormously depending on the car you drive, your age, location, and driving history. Choosing the right car can cut your premium by hundreds of pounds.
This guide explains how insurance groups work, which cars are cheapest to insure, and how to reduce your premium regardless of what you drive.
Understanding Insurance Groups
Every car sold in the UK is assigned an insurance group from 1 to 50 by the Group Rating Panel, which includes members from the Association of British Insurers and Lloyds Market Association. Group 1 is the cheapest to insure; group 50 is the most expensive.
The group is determined by:
- Vehicle value: More expensive cars cost more to replace, so they sit in higher groups.
- Performance: Top speed and acceleration affect risk. A 1.0-litre Fiesta sits much lower than a Fiesta ST.
- Repair costs: How much parts cost and how long repairs take. Cars with expensive body panels or complex electronics are penalised.
- Safety: Euro NCAP ratings, autonomous emergency braking, and other safety features can lower the group.
- Security: Thatcham security ratings for locks, alarms, and immobilisers. Cars without an immobiliser can be bumped up several groups.
- Bumper compatibility: How well the bumper absorbs low-speed impacts. Better bumper design means lower repair costs after minor collisions.
You can check the estimated insurance group for any car on our insurance groups page.
Top 20 Cheapest Cars to Insure
These cars fall into insurance groups 1 to 10, making them the most affordable to insure. They share common traits: small engines, low power, good safety ratings, and cheap parts.
| Car | Group | Engine | Typical Premium (25yo) |
|---|---|---|---|
| Volkswagen Up | 1 | 1.0L | £500 - £800 |
| Kia Picanto | 2 | 1.0L | £520 - £850 |
| Hyundai i10 | 3 | 1.0L | £540 - £900 |
| Fiat 500 | 3 | 1.2L | £550 - £920 |
| Dacia Sandero | 4 | 1.0L | £560 - £940 |
| Nissan Micra | 4 | 1.0L | £570 - £950 |
| Suzuki Swift | 5 | 1.2L | £580 - £980 |
| Honda Jazz | 5 | 1.3L | £590 - £990 |
| Skoda Fabia | 6 | 1.0L | £600 - £1,000 |
| Toyota Yaris | 6 | 1.0L | £610 - £1,020 |
| Vauxhall Corsa | 6 | 1.2L | £620 - £1,050 |
| Ford Fiesta | 7 | 1.0L | £640 - £1,080 |
| Seat Ibiza | 7 | 1.0L | £650 - £1,100 |
| Volkswagen Polo | 8 | 1.0L | £660 - £1,120 |
| Citroen C1 | 3 | 1.0L | £530 - £880 |
| Peugeot 108 | 3 | 1.0L | £530 - £880 |
| Toyota Aygo | 3 | 1.0L | £530 - £880 |
| Renault Clio | 7 | 1.0L | £640 - £1,080 |
| Mazda 2 | 6 | 1.5L | £600 - £1,000 |
| MG 3 | 5 | 1.5L | £580 - £980 |
Notice that the Volkswagen Up sits in group 1, making it one of the absolute cheapest cars to insure in the UK. The city car trio of Toyota Aygo, Citroen C1, and Peugeot 108 (which shared a platform until production ended) also sit in very low groups.
Cheapest Cars to Insure for New Drivers
If you have just passed your test, insurance is likely your biggest annual expense. New drivers aged 17 to 24 face the highest premiums, often over £1,500 per year even for low-group cars. Here are the best options:
- Volkswagen Up (Group 1): The absolute cheapest mainstream car to insure. Small, simple, and well-built. The 1.0-litre engine is peppy enough for town driving.
- Citroen C1 / Peugeot 108 / Toyota Aygo (Group 3): These three shared a platform and powertrain, so insurance groups are identical. The Toyota Aygo has the edge on reliability.
- Kia Picanto (Group 2): Comes with a 7-year warranty when new, and the 1.0-litre engine keeps insurance costs down.
- Skoda Citigo (Group 1-2): Essentially a rebadged VW Up with a slightly lower price. Hard to find now as production has ended, but excellent used options exist.
- Fiat Panda (Group 2-3): Larger than the 500 but in a lower insurance group. Practical and cheap to run.
A black box (telematics) policy can reduce new driver premiums by 20% to 40%. These policies monitor your driving and reward careful, consistent driving with lower renewal quotes.
Most Expensive Cars to Insure
At the other end of the scale, high-performance and luxury cars sit in groups 40 to 50. Annual premiums can exceed £3,000 even for experienced drivers.
| Car | Group | Engine | Why It Is Expensive |
|---|---|---|---|
| BMW M3 | 42 | 3.0L Twin-Turbo | High power, expensive parts, theft risk |
| Mercedes-AMG C63 | 45 | 4.0L V8 | Performance, repair costs, theft target |
| Audi RS3 | 40 | 2.5L 5-Cyl | Performance, specialist parts |
| Range Rover Sport | 43 | 3.0L V6 | High value, theft risk, repair costs |
| Porsche 911 | 48 | 3.0L Flat-6 | High value, performance, specialist repairs |
| Ford Focus RS | 38 | 2.3L Turbo | Performance hot hatch, theft magnet |
| Volkswagen Golf R | 34 | 2.0L Turbo | Performance, above-average repair costs |
How to Reduce Your Insurance Premium
Regardless of what car you drive, these strategies can lower your premium:
1. Compare Quotes Every Year
Never auto-renew. Loyalty is rarely rewarded in car insurance. Use comparison sites and also check direct-only insurers like Direct Line, Aviva, and NFU Mutual, which do not appear on comparison websites.
2. Increase Your Voluntary Excess
Increasing your voluntary excess from £250 to £500 can reduce your premium by 10% to 15%. Just make sure you can afford to pay it if you need to claim.
3. Build No-Claims Bonus
Each claim-free year reduces your premium. After 5 years, you typically get the maximum discount of around 60% to 65%. Consider protecting your no-claims bonus, which adds around £30 to £50 to your premium but means a claim does not wipe out your discount.
4. Consider Where You Park
Parking in a garage is cheapest, then a driveway, then on the street. Simply moving from street parking to a driveway can save 5% to 10%.
5. Reduce Your Annual Mileage
If you drive fewer miles, you are statistically less likely to have an accident. Accurate (not inflated) mileage estimates can reduce your premium. Some insurers offer pay-per-mile policies for low-mileage drivers.
6. Add a Named Driver
Adding an experienced driver (such as a parent) as a named driver can reduce a young driver's premium. Important: the main driver must be the person who drives the car most. Listing an experienced person as the main driver when they are not (called "fronting") is insurance fraud and voids your policy.
7. Improve Your Car's Security
Fitting a Thatcham-approved alarm or tracking device can reduce your premium. Some insurers require a tracking device for high-value or high-risk cars.
8. Pay Annually
Monthly payments include interest, typically adding 15% to 30% to the total cost. If you can afford to pay the full year upfront, do so.
Insurance and Running Costs Combined
Insurance is just one part of the total cost of car ownership. When choosing a car, consider the full picture: fuel, road tax, MOT, repairs, and insurance together. A car that is cheap to insure but expensive to repair (or vice versa) may not be the best overall value.
Our free car check tool shows estimated annual running costs for any UK car, including fuel, tax, MOT, and predicted repairs based on the car's individual MOT history. Combined with the insurance group data on this page, you can get a complete picture of what any car will cost to own.
For a broader view, our cheapest cars to run guide ranks every model by total annual cost, and our reliability rankings show which cars are least likely to need expensive repairs.