What are the cheapest cars to insure in 2023?

When you shop around for a new or used vehicle, a key consideration is on-road costs. These can include car insurance and, in particular, comprehensive car insurance if you’re seeking the broadest type of cover for the car you’re buying.

As a driver, it’s important to know that your car is covered in the event of an accident, so the question may be on your mind – what are the cheapest cars to insure in Australia? The answer is not as simple as you might think. Why? Car insurance premiums are not based purely on the type and age of a vehicle – how the vehicle is driven and by whom are also important factors.

What impacts car insurance premium prices?

The cost of your car insurance is in many cases as much about you and any other drivers listed on your policy, plus your and their driving habits, as it is about the vehicle itself. Car insurance providers in Australia have ratings systems that calculate premiums according to hundreds of factors. Many of these factors are the details you enter when you complete an online quote. They include:

• Age of the driver(s) listed on the policy
• Gender of the driver(s)
• Claims history of the driver(s)
• Car make, model and age
• Car safety rating
• Car garaging address
• Car value
• Cost to replace car parts and make repairs

Some of these factors may also affect the excess you have to pay if you need to make a claim. For example, as Moneysmart says, if a young driver was behind the wheel in an accident your insurer may charge you a higher excess to repair your car than if the person involved was 25 or older.

Car insurance premiums – your driver/s

Statistics show that males and people aged under 25 years are riskier drivers on average, so insurers tend to price their premiums accordingly. It is a double whammy if you are a male aged under 25 years, as young males are statistically more likely to be involved in serious crashes than older drivers.

If you share your car with other drivers, that can also affect an insurer’s perception of how risky your driving profile is. The more hands on the steering wheel, the greater the potential for something to go wrong on the road, at least in many insurers’ eyes.

When you list other drivers on your policy, their personal factors can become part of the premium calculation too – their age, driving history, claims history and so on. Think carefully about who you are sharing your wheels with.

Car insurance premiums – your car

The theft rate of your car (according to its make, model, year and so on) can be another driving factor of your car insurance premium.

Australian Bureau of Statistics data shows the number of victims of motor vehicle theft reached 55,037 in 2022 – an increase of 11 percent. Further, a report by the now-folded National Motor Vehicle Theft Reduction Council (NMVTRC) shows around half the vehicles stolen each year involve car theft at home. This means they occur right outside the owner’s residence – either in the garage, in the driveway or on the street in front of it.

With stolen cars being such a regular occurrence and many cars costing tens of thousands of dollars to replace, insurers generally consider your car’s theft rate as part of deciding what your insurance premium should be.

Another big factor is the safety of your car. If your car has a higher safety rating (as determined by ANCAP for new cars and UCSR for used cars), it and its passengers are seen as less likely to be involved in a car accident, or more likely to get through an accident with little damage due to the vehicle’s safety features. This means your insurer is less likely to have to make big payouts for car repairs/replacement, meaning they may be more willing to insure a car with a high safety rating for a relatively low premium, compared to ‘less safe’ models.

On the topic of car repair costs, some cars have parts that are more challenging to source (and therefore more costly) due to factors such as their availability or the supplier’s geographic location. Some parts are more expensive to repair or replace due to their complexity, such as those for specialty cars, or just because that is how they are priced. The age of the car can also play a factor; for example, heritage or classic cars can be more expensive to fix. This can impact the cost of your premiums.

The market value or agreed value of your car is another factor that contributes to the cost of car insurance premiums. You will need to decide whether to insure your car for one or the other, so you may want to do some research or obtain a few quotes to see how choosing each could affect your premium.

Car insurance budget tips

If you want to manage your car insurance budget carefully, look at all areas where you can potentially save. These could include increasing your excess to lower your premium, settling with your insurer on a lower agreed value than the higher market value of your car, or considering what features you really need in your car insurance and choosing a more basic policy to suit.

Also, many insurers offer car insurance discounts that can drop the price of your premium, sometimes by hundreds of dollars a year.

Depending on the insurer and policy you choose, these discounts could include:

• A no-claim discount or claims-free bonus – where you have not made a claim in several years
• Paying annually instead of monthly – where you pay your premium in full at the beginning of each year of your policy
• Exclusive driver – where you are the only driver of your car
• Multi-car – where you insure more than one car with the insurance provider
• First-timer – where you are insuring your car with the provider for the first time

Some insurers offer roadside assistance as an add-on to your policy, usually in exchange for an additional fee. This can sometimes be cheaper than sourcing your insurance from one company and your roadside cover from another, so it could be worth comparing your options in this regard.

Another common add-on offer is where the insurer pays for your excess on one claim per year, though this may only be for a particular type of claim (such as windscreen replacement).

Obtaining a car insurance policy that is tailored to your individual circumstances is arguably easier than ever these days, thanks to the internet. Comparison sites can make weighing up one provider with another a simpler process, and insurers have much more detailed and clearly worded websites of their own these days. They understand that the majority of people shop around online now.

Plus, there are potentially more ways to save than before, including with sign-up deals, as insurance companies strive to differentiate their products.

It is a good idea to do your research to work out what policies may suit your needs and how much they are likely to cost you.

Cheapest cars to insure in 2023

As you may now realise, the cheapest cars to insure differ depending on the demographics and lifestyle circumstances of the driver or drivers, as well as the car itself. However, what we can say is that the safer the car and the lower its theft rate, the cheaper the insurance premium is likely to be – before all the other factors come into play, of course.

So, when pondering what the cheapest cars to insure are in 2023, know that those with a better theft risk rating could make your insurance cheaper.

What is a theft risk rating? An initiative of the above-mentioned NMVTRC, which was committed to combatting vehicle crimes, the now on-hold rating system used vehicle theft data to show which cars are most at risk of being stolen in Australia. The ratings were based on stolen vehicles and did not reflect the security features of individual vehicles.

The cars that NMVTRC reported as having the lowest risk of theft (giving them a rating of five stars) during financial year 2020/21, with make, model and year manufactured detailed, include:

Small Passenger Cars

Daihatsu Cuore, 2000-05

Proton Persona, 2008-14

Mercedes-Benz B250BE W246, 2012-13

Mercedes-Benz B200BE W246, 2012-13

Mercedes-Benz B200 W246, 2012-19

Volkswagen Up AA, 2012-14

Mercedes-Benz A250 W177, 2019+

Ford Focus SA, 2018+

BMW 118d F 2011+

Mercedes-Benz A200 W177 2018+

Volkswagen Beetle 1L, 2013-18

Nissan Almera, 2011+

Fiat 500, 2007+

Medium Passenger Cars

Ford Mondeo MK2, 1996-01

Mercedes-Benz E200 W212 , 2012-16

Chrysler Sebring JS , 2007-13

Renault Fluence X38 , 2010-15

Mazda 6 GY , 2002-05

Subaru Levorg , 2015+

Toyota Camry GSV70R , 2017+

Citroen C5 , 2008-16

Volvo V40 , 2012-18

Mercedes-Benz C280 W204 , 2007-09

Volvo C30 , 2006-13

Lexus IS300 JCE10R , 2001-05

Large Passenger Vehicles

Mercedes-Benz S350 W221 , 2006-13

Lexus ES300h AVV60R , 2013-18

Mercedes-Benz E350 W212 , 2009-13

Sports vehicles

FPV GT BA , 2003-05

Tesla Model S , 2014+

BMW M2 F87 , 2016+

Honda Civic Type R , 2007-12

Mazda MX-5 ND , 2015+

Volvo C70 , 2006-13

FPV GT BF , 2005-08

MG MGF , 1995-2005

SUV/People Mover

Haval H2 , 2015+

Ford Endura CA , 2018+

Skoda Karoq NU , 2017+

Citroen C4 Picasso , 2007-13

Toyota Estima , 2006+

Ford Ecosport BL , 2017+

Lexus NX200t AGZ10R , 2014-17

Lexus NX200t AGZ15R , 2014-17

Volvo XC40 , 2018+

Lexus LX470 UZJ100R , 1998-08

Volvo XC70 , 2007-17

Toyota Avensis ACM21R , 2003-10

Volkswagen Multivan T5 , 2005-16

Peugeot 3008 , 2018+

Lexus RX350 GGL25R , 2015+

Renault Scenic , 1996-05

Ford Everest UA , 2015+

Jaguar E-Pace X540 , 2017+

Skoda Kodiaq NS , 2017+

Mazda CX-8 KG , 2018+

Land Rover Defender , 2000-16

Honda Odyssey , 2014+

Mazda CX-5 KF , 2017+

Cover image source: Nopphon_1987/Shutterstock.com