Car insurance can be costly – particularly for those under 25 who tend to have the highest premiums

Many drivers, including those still learning to drive, often overlook the need for car insurance when thinking about buying a new vehicle. However, car insurance can be rather costly, with several factors contributing to the price.

The expense of car insurance is a significant worry for drivers, especially those under 25 who typically face the steepest premiums. A recent RAC Report on Motoring revealed that 44% of drivers aged 17–24 cite it as their primary concern.

RAC suggests that the most effective method to lower your insurance premiums – particularly if you’re a young driver – is to select the right car. Insurance groups are determined by the Association of British Insurers (ABI), and vehicles in the lowest groups are generally the least expensive to insure.

Cars in low insurance groups are usually small, reasonably priced, and equipped with low-powered engines – although this isn’t always the case. The RAC advises considering your location and where you park your car when assessing insurance costs.

The RAC has provided a list of the cheapest new cars to insure in 2025, based on the quoted insurance groups of the cars. It emphasises that this is intended as a guide, and insurance costs can fluctuate depending on your personal circumstances.

Top 10 cheapest cars to insure for new drivers 2025

• Hyundai i10
• Volkswagen Polo
• Skoda Fabia
• Kia Picanto
• Toyota Aygo X
• Volkswagen Caddy MVP
• Fiat 500
• Dacia Sandero
• Renault Clio
• SEAT Arona

What makes a car cheap to insure?

According to the RAC, a vehicle’s performance represents the most significant factor in determining affordable insurance premiums.

It said: “Generally, a car with a large, powerful engine has a higher insurance premium than one with a small engine and more modest performance.

“Insurers deem high performance cars more likely to be involved in a collision at a higher speed, and more expensive to repair or replace alongside that.”

Additional elements that contribute to lower insurance costs include strong crash safety ratings, modest purchase prices and being less attractive to car thieves.