Car insurance groups have always been quite straight-forward to understand. Basically, if you have a small car that has a small engine, this will mean it has a low insurance band and will also mean that it is cheaper to insure and use. On the opposite side of the coin, the bigger the car and the bigger the engine, you will find you have to pay more in insurance premiums. Simple? Not quite.

In January last year, the way car insurance groups operated changed slightly, and many people are still coming to terms with the new system which sees groups 1-20 now become 1-50. In previous years there were 20 insurance groups, with one being the lowest group and twenty being the highest. Last year the grouping system went up to fifty, with one still being the lowest and fifty being the most expensive car insurance band that now features high-end sports cars such as Aston Martins.

You may well be thinking then, why change the system?

In basic terms it was argued by many in the motoring industry that the old 1-20 grouping system was too narrow to reflect the cost of repairing certain models. It was also believed that factors such as economical statuses of vehicles could not be taken into consideration with only twenty groups. Now that there are more groups, many insurance experts and executives hope that insurance premiums will be more accurate and easier to follow.

Because of the changes, you will find that most cars have seen their insurance group double. It is worthwhile noting, however, that your premium should have stayed the same. People automatically assume that because their car insurance group has doubled, the price that they have to be pay annually will also have doubled. This is not the case. As a general rule there should have been very little change in your premium.

Considerations that are made when deciding a car’s insurance group are the amount of time it takes to repair the car, the cost of parts and how quickly the car can accelerate. According to the Association of British Insurers, the cost of repairs amounts to more than half the money paid out in motor insurance claims – so you can understand why this kind of thing needs taking into account. Generally, a car which takes longer to repair and has more expensive parts (such as a prestige sports car) will be placed in a higher insurance group. This is also the case for a car that is nippy. A car that can accelerate quickly and reach high speed in no time is also a risk for insurers. Statistics show that it is more likely to generate high-priced claims.

Other aspects that insurers will look into are the security features that a car has. That is why a lot of older cars that do not have modern security technology will feature in the higher groups in comparison to newer cars that will be in the lower groups because they have more up to date security fitted. A car that has an alarm or an immobilizer fitted will be in the lower insurance groups because it will minimize the risk of theft.