What affects the price of car insurance
Car insurance prices depend mostly on who drives, where you live and the car itself: your age and experience, postcode, the car’s insurance group from 1 to 50, mileage and claims history. How and when you buy matters too. The average premium paid was £566 in April to June 2026 (ABI).
By the billsqueeze team · Facts checked: 31 October 2026 · Updated:
- Biggest factors: age and experience, postcode, car insurance group, mileage and claims.
- Every car has an insurance group from 1 to 50.
- Paying monthly usually costs more than paying once a year.
- Always give accurate details; fronting is fraud.
The main factors
| Factor | Why it matters |
|---|---|
| Age and driving experience | Younger and newly qualified drivers are statistically more likely to claim. |
| Where you live | Insurers price by postcode, based on theft, accidents and claims in the area. |
| Your car | Every car has an insurance group from 1 to 50; higher groups cost more to insure. |
| Annual mileage | More miles means more time on the road and more risk. |
| Claims and no-claims bonus | Each claim-free year usually earns a discount; recent claims raise the price. |
| Voluntary excess | Agreeing to pay more of any claim yourself can lower the premium. |
| Where the car is kept overnight | A garage or driveway can cost less than parking on the street. |
| How you pay | Paying monthly usually costs more in total than paying once a year, because of interest. |
Things you can check
- Compare at the right time: about three to four weeks before renewal.
- Check your mileage is realistic for how much you actually drive.
- Look at the excess: a higher voluntary excess can lower the price, but you pay more if you claim.
- Pay annually if you can: monthly payments usually include interest.
- Check the cover level: comprehensive cover isn’t always more expensive than third party.
Always answer honestly
Give accurate details. Getting something wrong can mean a claim is refused or the policy cancelled. Naming someone else as the main driver of a car you mostly drive, known as fronting, is fraud.
billsqueeze doesn’t give insurance advice or recommend policies. This guide is general information; check the policy wording before you buy.
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Common questions
What is a car insurance group?
A rating from 1 to 50 for every car model, based on things like repair costs, performance and security. Higher groups cost more to insure.
Why is my car insurance so expensive?
Common reasons are being a young or new driver, living in a postcode with more claims, a high insurance group or recent claims.
Is it cheaper to pay car insurance annually?
Usually. Paying monthly often means paying interest on top of the premium.
What is fronting?
Naming a lower-risk driver, such as a parent, as the main driver of a car someone else mostly drives. It’s fraud and can void the policy.