Five fibs which could invalidate your car insurance
- False statements and non-disclosure on insurance applications or renewals can lead to a policy being refused, cancelled or made void;
- To avoid non-disclosure, motorists warned to keep their insurer up-to-date with any changes in their personal circumstances or any modifications to their car;
- Drivers who have had an application refused or cancelled will find it difficult and more costly to get cover in the future.
GoCompare Car Insurance is warning motorists not to try and cut the cost of cover by lying about their driving and has highlighted five of the most common ‘white lies’ used by motorists.
Last year 449,000 confirmed or suspected dishonest insurance applications were detected by insurers*. Of these, most were for car insurance where drivers either lied or withheld information in an attempt to get cheaper cover. The most common lies applicants made included the nature of their occupation, their driving record and previous claims and motoring convictions that were not disclosed.
The consequences for drivers caught being economical with the truth are severe. Depending on the circumstances, their insurer may cancel the policy, refuse to pay a claim or prosecute them for fraud.
When applying for or renewing car insurance, drivers are under duty to disclose information and truthfully answer the questions put to them. Insurers use this information to decide whether to offer insurance to the applicant, on what terms and at what price. If subsequently an insurer discovers that information has been withheld or given dishonestly then they may reduce or refuse to settle a claim and/or cancel the policy.
If the driver is found to have been fraudulent then the insurer may treat the policy as if it had never existed. The applicant could also end-up in court and find they are unable to get insurance in the future.
Five fibs which could invalidate your car insurance
- How the car is used
There are three types of car usage: social; social and commuting; business use. Social usage excludes any travel to and from work or other business use so, if you use your car to get to work then you need to make sure your policy covers commuting. Insurers tend to charge a higher premium for commuting and business use because drivers are more likely to be on the road at the busiest times of day.
To get cheaper cover for a young driver, some parents arrange insurance for their son or daughter, listing them as an additional driver as opposed to the main driver. This is known as ‘fronting’ and insurers consider it fraud. The person who uses the car most often should be listed as the main driver on the policy, additional drivers should only be added if they drive the car occasionally.
Your occupation and the way you describe it will impact on the price you pay for car insurance. You will also need to tell your insurer if you change your job.
- Withholding information about previous claims or damage to your car
In addition to more serious accidents, you should declare details of minor knocks and dents – even if you didn’t claim for the accident.
- Failing to own-up to penalty points or other driving convictions
Deliberately failing to disclose driving offences is fraudulent. Drivers should declare penalty points and other motoring convictions when applying for a policy. Drivers should also notify their insurer immediately of any penalty points received during the term of their cover – rather than waiting until it comes up for renewal.
Lee Griffin, Founder and President at GoCompare commented, “Honesty is always the best policy when applying for or renewing your car insurance. To make decisions about your application and the terms they offer you - insurers require information about you, your car and any other drivers who use it. Drivers are required to answer all the questions on the application form as fully and accurately as possible.
“A common area of potential misrepresentation concerns claims and losses. Some drivers mistakenly believe that they do not have to declare damage to their car if they paid for the repairs out of their own pocket or for a claim which was not their fault and was settled by the ‘at-fault’ driver’s insurer. Typically, insurers require information on all incidents within the last 5 years - so, both of these types of incidents would have to be declared.
Lee continued, “Drivers also need to remember to keep their insurer up-to-date with any changes over the course of their policy. For example, if they change their occupation, receive any motoring convictions or points or make any changes to their car.
“The consequences of withholding or giving false information to obtain cheaper car insurance can be severe. Far from saving money, being untruthful can be costly should you need to make a claim and may even lead to your policy being cancelled or invalidated. There are significantly better ways of reducing the cost of your cover - including shopping around at renewal, opting for a larger excess, limiting your mileage or, opting for a blackbox ‘telematics’ policy.”
For more information on insurance declarations and non-disclosures visit: https://www.gocompare.com/car-insurance/declarations-and-non-disclosures/
For further information please contact:
Anders Nilsson or Louisa Marsden at GoCompare on 01633 654 054 / 01633 655 132
Gordon, Jason or Liz at MAW Communications on 01603 505 845
Keep up-to-date with GoCompare on Twitter; @GoCompare
Notes to editors
*Source: ABI annual detected insurance fraud report (2017)
GoCompare is a comparison website that enables people to compare the costs and features of a wide variety of insurance policies, financial products and energy tariffs.
GoCompare does not charge people to use its services, and it does not accept advertising or sponsored listings, so all product comparisons are unbiased. GoCompare makes its money through fees paid by the providers of products that appear on its various comparison services when a customer buys through the site.
GoCompare does not sell its customers’ data.
When it launched in 2006, it was the first comparison site to focus on displaying policy details rather than just listing prices, with the aim of helping people to make better-informed decisions when buying their insurance. GoCompare has remained dedicated to helping people choose the most appropriate products rather than just the cheapest, and has teamed up with Defaqto, the independent financial researcher, to integrate additional policy information into a number of its insurance comparison services. This allows people to compare up to an extra 30 features of cover.
GoCompare is the only comparison website to be invited to join the British Insurance Brokers’ Association (BIBA) and is authorised and regulated by the Financial Conduct Authority (FCA).
Senior PR Executive
01633 655 132