Each and every car and commercial vehicle in the United Kingdom must be registered into a ‘car insurance group’ which ranges from 1 to 50. These car insurance groups were created by the ABI Group Rating Panel in order to assess the risks which a certain vehicle presents to a car insurance company.
Due to there being so many different types of vehicles and with so many new models being constantly produced and introduced, it certainly helps to organise the different cars into groups according to their make, model and engine size as well as other factors to create workable and suitable insurance policies.
The ABI (Association of British Insurers), the LMA (Lloyd’s Marketing Association) and Thatcham Research Centre all make up the ABI Panel. It is the ABI panel who keep the group ratings constantly update. As of the year 2009, the insurance groups were increased from 1-20 groups to 1-50 groups which allow for a far more precise group rating system to be in place.
How will car insurance groups affect your premium?
Car insurance groups do actually have an effect on your premium. The way it works is that group 1 is considered the least risky and therefore the cheapest to insure. Whereas, group 50 are seen as the most risk and will, therefore, experience more expensive insurance.
Vehicles with a low group rating are typically worth less money and the cost of repairs, therefore, will be relatively small. Cars which fall into the group 1 ratings including cars such as Volkswagen Fox and a Fiat Panda.
In contrast, the cars which you may find in group 50 include the likes of Lamborghinis, high-end porches and Ferraris. This is due to the fact that they can reach 0 to 60 mph extremely quickly, have turbocharged engines and the costs associated with damages and repairs are high in price. Furthermore, high-performance cars are more likely to the victim of theft since they are more desirable.
As well as the make of the car, the model plays a role in the grouping. For instance, more expensive and faster models will fall into a higher rating. Take, for example, an Audi R8 will be put in a higher group than that of an Audi A1 – same make, different model.
Thus, if an accident, theft, fire or flood were to occur, the vehicles which are closer to the rating of 50 are obviously going to be far more expensive for companies to repair or replace when directly compared to those which are closer to group 1.
What determines the car insurance groups?
In the past, the group ratings tended to be initially dependant on the size of the vehicle’s engine. However, more recently the emphasis has shifted from engine size to the acceleration time from 0 to 60 mph as well as how long it would take and cost for the repairs in order to get the car back to the pre-accidental condition. Given the increasing range of cars, the latter seems more efficient when grouping cars.
Damage and parts costs
The lower the costs of replacement parts and repairs, the lower the group. In addition to this, the likelihood of damage happening to the car is also assessed.
New car values
The price of a new car is taken into account since they are typically a good guide to the cost of replacement parts and repairs.
Part prices
On a similar theme, the price of car parts is taken into consideration with the grouping. A standard list of 23 common parts is utilised in order to compare a certain manufacturer’s car part costs from another’s. The lower the costs, the closer to group one a vehicle will be.
Performance of car
The top speed and capacity for acceleration are factors which are heavily taken into account. As insurers are all too aware from the claim statistics that car which are considered high performance often result in more insurance claims than any other.
Safety of the car
Vehicles which are fitted with an Autonomous Emergency Breaking (AEB) system are far less likely to be involved in accidents of the low-speed front to rear variety. Thus, these vehicles with AEB fitted as standard will be taken into account when deciding the grouping and will see reduced insurance rating.
Car security
Cars fitted with certain features fitted as standard by motor manufacturers are a factor which can help to reduce the cost of the insurance claims. These features include alarm/immobilisation systems, high-security doors locks, glass etching, locking devices for alloy wheels, coded audio equipment and visible VIN numbers.
Other things that may affect your premium
Additional things which will make up the car insurance groups other than simply those above, which will determine what you pay for your car insurance. These are more personal things such as age and level of driving experience. These factors are crucial for insurers when they are pricing up a premium.
Insurance which is specific to younger drivers tends to be pricier for those who are under the age of 25 since they are less experienced in driving on the roads and are therefore more likely to have an accident if we are talking statically. In consequence, you can expect to have a high-priced insurance premium on higher grouped cars if you are young and inexperienced when it comes to driving.
Another thing which may affect your premium is if you personally have a long history of claims, this will make the insurer see you as more of a risk. Furthermore, if you have ever been convicted of driving charges such as speeding or driving under the influence of alcohol or other substances, you can expect a higher price on a premium rate.
If you are actively looking to save money on your car insurance, there are a few things you can do to bring down the price. You could seek a no claims bonus, have more safety features installed in your vehicle or participate in that Pass Plus scheme which is essentially continuous driving lessons once you have passed your test to teach you about the motorway and the like. Having Fleet Insurance can also help with this. Fleet Insurance allows you to cover a number of vehicles under the same policy, which will save you a fair bit of money on the insurance you take out.