Car insurance sometimes seems like a mystery - and you can't understand why you have been charged the premium you have. Nor can you understand why having changed a family saloon for another one premiums might have skyrocketed despite the fact that you haven't made a claim. If you are concerned about the cost of your premiums making sure you buy a car in a lower insurance group can often keep costs down. Here we explain how they insurance groups system works and the factors that affect the price you have to pay.

The Group Rating System
Insurance companies classify cars in order to provide the correct level of insurance. To do this each car is assigned a group between 1 and 20. This means that each model of car can be accurately banded with cars of similar characteristics. There can be a significant spread of groups within a particular model range.

How the System Works

Nearly three quarters of all money paid out in motor insurance claims goes on repairing cars. The cost of spare parts and the times taken by repairers are therefore major factors in pricing motor insurance. The factors used to calculate group ratings are:

1. Damage and Parts Costs: The likely extent of damage to each car model and the cost of the parts involved in its repair. The lower these costs, the more likelihood there is of a lower group rating.
2. Repair Times: Longer repair times mean higher costs and the greater likelihood of a higher group rating. Different paint finishes on modern cars are an important factor. These, too, are taken into account.
3. New Car Values: The prices of new cars identify the higher specification models within a model range.
4. Body Shells: The availability of body shells (the basic frame of the car) is taken into account in group ratings because they are essential for certain accidental damage repairs.
5. Performance: Acceleration and top speed are important factors. Insurers know very well, from their claims statistics, that high performance cars often result in more frequent insurance claims.
6. Car Security: Security features fitted as standard equipment by motor manufacturers can help to reduce insurance claims costs. Such features include high security door locks, alarm/immobilisation systems, glass etching, coded audio equipment, locking devices for alloy wheels and visible VIN numbers.

Note that group ratings determined by the Association of British Insurers are recommendations only. Individual insurers, depending on their own experience, may vary from these recommendations.

Recommended Group Ratings

The different groups available range from group 1 (the lowest) to group 20 (the highest). Most family cars fall into groups 6 to 12, unless they have high-powered engines. If you have a sports car, or high-risk car then the group rating will be higher. So the lower the group rating, the less your insurance premium costs!

If the model you are interested in is not listed here you can check the full ABI listings