INSURANCE rates have been slashed for the new Subaru Legacy meaning drastically lower running costs - already significantly reduced thanks to much better fuel economy and lower 'Benefit-In-Kind' taxes for company car drivers.

Impressed with Subaru's security upgrades and accident repair initiatives, the Association of British Insurers has awarded the new Legacy 2.0i saloon and Sports Tourer an insurance group 11E rating compared to 14D for the old model. Meanwhile, the Legacy and crossover Outback see a reduction from 15D to 13E with the new 245 PS Legacy 2.0R and Outback 3.0R pegged at 15E. The old Outback H6 carried a 16D rating despite being 36 PS less powerful.

These new insurance ratings mean the new Legacy and Outback will be even more cost-effective to run. Most versions enjoy big fuel economy improvements - by as much as 7.1mpg for the Legacy 2.5i automatic. Lower exhaust emissions mean valuable 'BIK' tax reductions. The new Legacy 2.0i Sports Tourer is rated at only 20% instead of 27% for the old model. The new Legacy - which starts at £15,985 on-the-road for the 2.0i saloon - was recently voted Car of the Year Japan 2003-4.