You want cheap car insurance. Buying a tiny-engined, low-specification small hatchback isn’t necessarily the way to achieve it.
A leading comparator website reckons that, in fact, the 10 cheapest cars to insure include a two-seater convertible, a stylish coupé and two smart saloons.
The data is based on GoCompare’s insurance price index, which averages car insurance costs in the UK. The insurer says the latest data shows that the average annual premium between January and March 2025 was seven per cent cheaper than the previous year, having fallen from £450 to £418.
Along with the latest data, GoCompare also revealed the top 10 cheapest cars to insure, according to the same price index – including some surprisingly desirable cars.
Here’s the list in full – along with a guide to how much you’ll pay, along with the pros and cons of each model.
10. Volvo S40 (1995-2012)
Volvo’s smallest saloon might not have been a class leader in its day, but it has a lot going for it as a used buy. You get a classy interior with an unusual ‘floating’ centre console and lots of high-quality materials, equipment levels are good, and the second-generation S40 (2004-2012) is surprisingly enjoyable to drive – it was based on the agile Ford Focus. First-generation models (1995-2004) are more stodgy, but still extremely comfortable and ageing very well.
Average cost to insure: £290
Price from: £800
Pros: Smart, comfortable, good to drive in second-generation form
Cons: Mk1s are stodgy, both versions can feel cramped inside
9. Saab 9-3 (2003-2014)
The third-generation Vauxhall Vectra was not an exemplary starting point from which to build an executive saloon, but Saab had a good go and the 9-3 was surprisingly convincing. True, it didn’t handle with the alacrity of the rival BMW 3-Series, while you could tell this was a company on the ropes by the somewhat tacky interior plastics. But a range of punchy turbocharged engines, high comfort levels plus convertible and estate body options meant the 9-3 still had plenty going for it.
Average cost to insure: £290
Price from: £700
Pros: Smart looks, smooth ride, great seats, roomy
Cons: Cheap interior plastics, some electrical fragility
8. Vauxhall Agila (2001-2014)
No prizes for guessing why the Agila is cheap to insure. After all, boy racers would rather take the bus, and who’d want to steal one? On the plus side, the little engines are perky and eager, while the boxy body shape means there’s loads of interior space for such a small car. But you still have to live with the plasticky interior and humdrum driving dynamics. Second-generation cars are smarter and slicker, but still aren’t going to grace any bedroom wall posters any time soon.
Average cost to insure: £290
Price from: £600
Pros: Roomy, zippy engines, cheap to run
Cons: Uninspiring to look at, to sit in and to drive
7. Peugeot RCZ (2009-2015)
Now here’s a car you really wouldn’t expect to be quite so affordable to insure. The RCZ was Peugeot’s answer to the Audi TT, and it was a good one too, with its sweeping double-bubble roof, snarling front end and pert tail coming together to form a car that was arguably even more attractive than its big-name rival. Inside it felt a little less special, and a firm ride marrs cars fitted with the larger wheel options. But if you’re after a stylish car that’s affordable on insurance, look no further.
Average cost to insure: £279
Price from: £2,000
Pros: Drop-dead gorgeous looks, tidy handling
Cons: 1.6 petrols can be unreliable, big wheels mean a harsh ride
6. Fiat Panda (2003-2011)
No surprise to find the Panda here – it’s cheap and cheerful motoring at its best; chock-full of Italian charisma, with mechanical simplicity and affordability at its heart. Original Pandas (1980-2003) are now classics, while the updated models (2003-2011) are still in the bargain bin. Whichever you choose, they’re all delightful to drive, extremely practical and very characterful. True, early examples can look quite tired by now as a result of poor interior quality, but find a good one and you’ll fall in love pretty rapidly.
Average cost to insure: £279
Price from: £500
Pros: Cheap, cheerful, practical, characterful
Cons: Fragile plastics, dubious dependability
5. Toyota iQ (2008-2015)
Odd to think that the iQ, Toyota’s pseudo-luxurious small car, features here, whereas the more utilitarian Aygo doesn’t. Perhaps higher-risk first-time drivers are more likely to settle for the latter, whereas the former is more likely to be sought by careful older buyers. Either way, the iQ is a quirky little car that makes urban motoring far more interesting, thanks to its upmarket interior with an unusual layout.
Average cost to insure: £265
Price from: £1,500
Pros: Upmarket, quirky, easy to park, reliable
Cons: Not as roomy as some other city cars
4. Smart Fortwo (1998-2024)
Another car you might expect to see in this list, the Smart’s dinky dimensions, miniscule power output, low repair costs and complete lack of any sporting pretensions make it a fairly safe bet as far as insurers are concerned. And if all you need is a little two-seat urban runaround, there’s simply no car that does it better, whether your budget suits one of the original models (1998-2007) or one of the more up-to-date versions.
Average cost to insure: £260
Price from: £1,000
Pros: A doddle to park, agile around town, cheap to run
Cons: Not great on the motorway, only two seats, tiny boot
3. Citroën Xsara (1997-2006)
If you don’t remember the Xsara, you’re probably not alone. This was Citroën’s Golf rival during its era of anonymity, although beneath its plain clothes the Xsara was actually a car of surprising talent. It was based on the Peugeot 306 and so benefitted from that car’s class-leading blend of ride and handling, while the large boot and roomy interior, especially in estate form, made it a very useful car. Diesels were brilliantly frugal, too. These days, though, finding one will be difficult – they’ve all but vanished.
Average cost to insure: £256
Price from: £500
Pros: Comfortable, good to drive, spacious, frugal diesels
Cons: Achingly dull to look at, some cheap interior plastics
2. Peugeot 206 (1998-2012)
The 206 will always be remembered as the car that couldn’t live up to its illustrious predecessor, the 205. However, this was a great small car in its day, with stylish looks, a surprisingly plush interior, excellent handling and a range of extremely parsimonious diesel engines. Electrical reliability was never a strong point, but find a good one and you’ll have a handsome and enjoyable urban runaround.
Average cost to insure: £255
Price from: £500
Pros: Good to drive, handsome, economical diesels, smart inside
Cons: Electrical maladies commonplace
1. Mazda MX-5 (1989-present)
And so we come to the biggest surprise of all on this list: the Mazda MX-5 is the cheapest car to insure in Britain at the moment. If nothing else, this is a great excuse to go out and buy one, because the MX-5 is quite simply the most accessible and effective way of enjoying two-seat, wind-in-the hair motoring, whatever your budget. Older ones can be had for little more than a grand, while the latest examples are the best yet and easily one of the best new cars on sale. That they cost so little to insure is simply the icing on the cake.
Average cost to insure: £250
Price from: £1,500
Pros: Reliable, good-looking, well built, an absolute hoot to drive
Cons: Cheaper examples can be rust-prone