well the way insurance works is they go by the size of the engine.
Not really true. As a new rider he could probably get coverage on an 800, 1100, or 1300CC metric cruiser for about the same money as a 500cc sportbike.
The style of bike makes a HUGE difference in the <SS market, which is the same reason that people are leaning towards nakeds as they often offer similar performance to sportbikes, but the insurance is significantly less.