what-are-car-insurance-groups

What are Insurance Groups? Insurance Groups Explained

When you go to buy a car you might get told that it is a cheap car to insure or else be warned that it is going to be expensive to get cover for. Why is this and how does the vehicle you buy affect the insurance premium you have to pay? Well it all has to do with insurance groups but what are insurance groups? Here we are going to spend a few moments explaining what insurance groups are and what they mean for you. In upcoming posts here on The Cheapest Cars to Insure we’ll also be reviewing some of the cars in each insurance group to see if they’re worth spending your hard earned money on.

You probably already know that different cars are rated differently by insurance companies to reflect the risk factors they believe each one represents to them. The car group rating isn’t the only factor which is taken into account when working out the cost of insurance but it is one of the most important ones. The following are some of the most important points on the subject.

The Basics

All cars are now given a rating of between 1 and 50. You might have heard before about ratings from group 1 through to 20 but this old way of assigning groups was replaced by the 50 group approach in 2010. When a car insurance company works out a premium the group rating of the vehicle in question is factored in automatically.

Who Decides the Ratings?

You might be surprised to realise that it isn’t your insurance company which works out which category to put each vehicle in. This work is done by a Group Rating Panel which is made up experts from the Association of British Insurance and Lloyds Market Association. Having said that, the ratings they suggest can be altered by the insurance companies based upon their own experience, so different insurers can easily have varying group ratings for specific cars.

What Are Insurance Groups Ratings Based On?

There are a number of different issues which the insurance Group Rating Panel looks at in order to assign the appropriate Insurance group rating to each car. These are as follows:

  • The performance factors, such as the top speed, the acceleration and the overall image and desirability of the vehicle. Sporty, high performance cars tend to be in the higher groups and be more expensive to insure.
  • The price of the model of car when new. Even if the car you are insuring isn’t new this part of the rating will still be factored in.
  • The cost of replacing the parts which might be damaged in severe accidents.
  •  The cost of labour and parts needed to carry out repairs following a fairly minor simulated accident.
  •  The availability and cost of the vehicle’s body shell.
  • The theft deterrents such as locks and security devices which have been installed as standard by the manufacturer.

What Does This Mean to Me?

Now we’ve looked at the question of what are insurance groups, let’s take a few moments to see what all of this means for you.  Basically, the lower the insurance group rating the lower your insurance premium is likely to be. This is because it is seen as a vehicle which isn’t going to cost the insurance company a huge amount of money in claims. In fact, if you get a number of quotes for different cars you will probably begin to see that the insurance group rating makes a big difference to the premiums you are quoted. This is especially true for young drivers, who will tend to pay more than older, more experience motorists.

How to Find the Right Car in a Group Which Suits You?

When you are planning on buying a car and don’t want to pay through the nose for insurance it makes sense to check the group rating first of all. The person selling the vehicle may tell you that it is a low rated car but it’s always worth taking a few moments to get a quick online quote to help you decide whether or not the insurance cost is going to be acceptable to you.

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