12 March 2026 | See disclaimer
Car insurance premiums are highly personalised and tailored to an individual's circumstances. While the car you drive is a key factor, your age, address, driving history and claims you've made play an equally significant role.
Instead of providing you with a fixed price list, we explore the attributes of vehicles that often attract lower premiums. This is helpful for those who are in the process of purchasing a new car or for anyone reviewing their current insurance costs.
Key Considerations When Purchasing a Car
Smaller cars can be cheaper to insure
A vehicle that has a lower market value may be cheaper to insure. Purchasing a small car may also have cheaper repair costs compared to expensive and newer cars entering the market.
Consider the safety features of a car
When purchasing a new car, safety features are a key consideration to keep in mind. It’s best to note that while some safety features can determine your car insurance premium, not all features will reduce the cost. It’s also worth weighing up whether the safety features will cost you more long-term. While cars with these features may be involved in less accidents, this may lead to more expensive repair costs if a claim is made.
Popular cars aren’t always cheaper to repair
An insurer will consider the specific make and model of your car and estimate the likely repair costs in case of an accident, weighing up how much it would cost for panelbeaters to fix your vehicle. Choosing a popular car doesn’t guarantee a lower price as your premium is calculated on the costs of parts, repairs and the labour involved, regardless of its popularity on the road.
Factors Within Your Control That May Influence Your Premium
There are several ways you could save on your car insurance premium. This includes choosing a higher excess to lower your instalments, maintaining a clean driving record and paying your premium annually in one lump sum.
It’s Not Just About the Car
Although part of your insurance premium is based on the type of car you have, it is also impacted by personal factors. These include the driver's age, location, where the car is primarily kept at night, your driving history and previous claims record.
Another key factor your insurer will note is how you use your car. Is your vehicle mostly used for personal trips on the weekends or is it usually for commuting to and from work? Car insurance providers will also ask if your car is used for work-related travel such as meeting clients outside of the office. After calculating these factors, your insurer will determine what your individual premium is.
Not sure what your premium might be? You can get a quick idea with our car insurance estimator.
What About Hybrids or Electric Vehicles (EVs)?
Hybrid and electric vehicles are typically more expensive to insure compared to internal combustion engines, such as petrol and diesel cars, which can often result in higher insurance premiums! Although these cars have excellent safety features, they also have complex parts and systems, meaning it can be more expensive for repair shops to replace them.
Because these vehicles are complex and new to the market, it's more likely for there to be a shortage of specialist EV repairers and technicians. This means insurers might be required to pay extra to transport these cars to a specialist. It can also mean expensive shipping costs to import new parts.[1] With these factors in mind, hybrid and electric cars may be more expensive to insure compared to other models.
To know the true cost of insurance for your new or existing car, get a personalised quote that's tailored to you and your personal circumstances.
Get a quote online with Budget Direct's Award Winning cover and save 15%^ on your car insurance for the first year purchased online.
