by Table of Contents
Table of Contents
Car insurance is one of those unavoidable costs of owning a vehicle, but it doesn’t have to break the bank. The fee you pay for coverage depends on a variety of factors, including your driving history, location, and crucially, the car you drive. Some autos are more budget-friendly to insure due to their high safety ratings, low repair costs, or reduced risk of theft.
Whether you’re a new driver in the UK, a family in the USA, or commuting in Australia, choosing a Cheapest cars to insure for young drivers can save you hundreds of dollars annually. In this manual, we’ll examine the cheapest cars to insure globally in 2025, break down why they’re affordable, and share tips to keep your premiums low.
Why Insurance Costs Vary
Insurance companies calculate premiums based on risk. A car with high safety ratings, cheap parts, and a low likelihood of theft is less risky to insure than a high-performance sports car or luxury car with costly repairs. Your area also plays a role; urban areas with higher accident or theft rates often mean pricier policies. For drivers worldwide, selecting a Cheapest used cars to insure is a smart way to handle ongoing costs, especially as car insurance rates have risen by an average of 12% in the USA alone since 2024.
Top 10 Cheapest Cars to Insure in 2025
Here’s a rundown of 10 budget-friendly insurance cars that stand out for their affordability across key markets like the USA, UK, Canada, Australia, and the EU. These cars combine strong safety features, low repair costs, and practical designs that insurers love.
1. Honda CR-V
- Year Range: 2021–2025
- Reasons It’s Cheaper: The Honda CR-V is a compact SUV with a stellar reputation for safety, earning a 2023 IIHS Top Safety Pick+ award. Its low repair costs and minimal theft rates keep premiums down. Features like Honda Sensing (collision braking, lane keep assist) reduce accident risks.
- Best Markets: USA (average annual premium: $1,932), Canada, Australia
- Why It Shines: This family-friendly SUV is a top pick in North America for its reliability and low claim rates, making it one of the cheapest SUVs to insure.
2. Subaru Outback
- Year Range: 2021–2025
- Reasons It’s Cheaper: With standard all-wheel drive and top safety ratings from IIHS, the Subaru Outback has fewer bodily injury claims. Its durable build and affordable parts lower repair costs.
- Best Markets: USA (average annual premium: $1,427), Canada
- Why It Shines: Perfect for drivers in snowy or rural areas, the Outback’s low insurance cost makes it a favorite for budget-conscious families.
3. Mazda CX-5
- Year Range: 2021–2025
- Reasons It’s Cheaper: The Mazda CX-5 boasts excellent safety scores and affordable replacement parts. Its compact size and strong crash test performance reduce claim frequency.
- Best Markets: USA (average annual premium: $1,071), Canada, Australia
- Why It Shines: This stylish SUV offers a premium feel without the high insurance costs of luxury models, ideal for urban drivers.
4. Subaru Crosstrek
- Year Range: 2021–2025
- Reasons It’s Cheaper: Another Subaru star, the Crosstrek combines a low MSRP with high safety ratings and low theft rates. Its compact size minimizes damage in collisions.
- Best Markets: USA (average annual premium: $1,469), Canada
- Why It Shines: Great for young drivers or city dwellers, the Crosstrek is a versatile, safe, and affordable car to insure.
5. Toyota RAV4
- Year Range: 2021–2025
- Reasons It’s Cheaper: The RAV4’s robust safety features, including Toyota Safety Sense, and widespread availability of parts make it a low-risk choice for insurers.
- Best Markets: USA, Canada, Australia (average annual premium: $1,580 in the USA)
- Why It Shines: A global bestseller, the RAV4 is a practical SUV with low insurance costs across multiple markets.
6. Volkswagen Polo
- Year Range: 2018–2025
- Reasons It’s Cheaper: In the UK, the Polo sits in low insurance groups (1–4) due to its modest 1.0-liter engine and five-star Euro NCAP rating. Its compact size and low repair costs help keep premiums down.
- Best Markets: UK, EU
- Why It Shines: Ideal for young drivers in Europe, the Polo is a roomy, reliable hatchback that’s easy on the wallet.
7. Subaru Impreza
- Year Range: 2021–2025
- Reasons It’s Cheaper: As the cheapest sedan to insure in the USA, the Impreza offers strong safety ratings and affordable parts. Its low claim rates make it a budget-friendly choice.
- Best Markets: USA (average annual premium: $2,120), Canada
- Why It Shines: This sedan is a great pick for those who prefer cars over SUVs but still want low insurance costs.
8. Kia Forte
- Year Range: 2021–2025
- Reasons It’s Cheaper: The Kia Forte is a compact sedan with solid safety features and low repair costs. Its affordability and reliability make it a low-risk vehicle for insurers.
- Best Markets: Canada, USA
- Why It Shines: Perfect for teen drivers or budget-conscious buyers, the Forte combines style and low insurance rates.
9. Vauxhall Corsa
- Year Range: 2019–2025
- Reasons It’s Cheaper: A staple in the UK, the Corsa falls into insurance group 1, thanks to its small engine and strong safety features. Its popularity ensures affordable parts.
- Best Markets: UK, EU
- Why It Shines: This practical hatchback is a go-to for new drivers looking for cheap-to-insure vehicles in Europe.
10. Nissan Kicks
- Year Range: 2021–2023
- Reasons It’s Cheaper: The Nissan Kicks is a budget-friendly subcompact SUV with low repair costs and good safety features. Its affordable MSRP keeps insurance premiums manageable.
- Best Markets: USA (average annual premium: $1,944), Canada
- Why It Shines: A great choice for urban drivers, the Kicks offers crossover appeal without high insurance costs.
Compact Cars vs. SUVs vs. Sedans: Which Is Cheapest to Insure?
When it comes to insurance rates by car type, not all vehicles are created equal. Here’s how compact cars, SUVs, and sedans stack up:
- Compact Cars: Models like the Volkswagen Polo and Vauxhall Corsa are usually the cheapest to insure, especially in the UK and EU, due to their small engines and low insurance group ratings. However, they may sustain more damage in collisions with larger vehicles, slightly increasing liability costs.
- SUVs: Surprisingly, compact SUVs like the Honda CR-V and Mazda CX-5 often have lower premiums than sedans in the USA and Canada. Their bigger size offers better occupant protection, leading to fewer bodily injury claims.
- Sedans: Sedans like the Subaru Impreza and Kia Forte are budget-friendly in North America, thanks to their fuel efficiency and inexpensive parts. However, they can be barely pricier to insure than SUVs due to higher collision damage risks.
In general, compact SUVs are the sweet spot for insurance savings in the USA and Canada, while compact cars dominate in the UK and EU due to their low insurance group ratings.
Tips to Reduce Insurance Costs
No matter which car you drive, these strategies can help you secure lower premiums:
- Shop Around: Compare quotes from at least three insurers. Rates vary significantly, and companies like Nationwide and GEICO often offer competitive prices.
- Choose a Higher Deductible: Opting for a higher deductible can lower your premium, but ensure you can afford the out-of-pocket cost if you need to file a claim.
- Leverage Discounts: Ask about discounts for safe driving, bundling policies, or low mileage. Many insurers reward good driving records or vehicles with anti-theft systems.
- Consider Telematics: In the UK and Canada, black box or telematics insurance tracks your driving habits and can lower premiums for safe drivers.
- Maintain a Clean Driving Record: Avoiding accidents and tickets can significantly reduce your rates over time.
- Park Smart: In high-theft areas, parking in a garage or well-lit area can lower your premium.
- Buy Used: Older models (3–5 years old) often have lower premiums due to reduced replacement costs, provided they have modern safety features.
Conclusion
Choosing a safe and inexpensive car like the Honda CR-V, Subaru Outback, or Volkswagen Polo can make a great difference in your insurance costs, whether you’re in the USA, UK, Canada, Australia, or the EU. These cars combine strong safety ratings, low repair expenses, and practical designs that insurers favor. To maximize savings, compare quotes from numerous providers, consider telematics policies, and maintain a clean driving record. Before you buy your next car, check its insurance group or get a quote to avoid surprises. Drive smart, and keep your wallet happy!
