Would your car insurance application pass a lie detector test?
Do you ever ‘bend the truth’ to save a few pounds? Few people would admit to telling outright lies on a car insurance application, but misrepresentations, withholding certain facts or simply making mistakes can have serious consequences.
Whether you make your application online or on the phone, the insurer will ask you various questions to discover what sort of risk you and your car present. It’s important that you answer as honestly and accurately as you can, because your answers will affect your quote.
What happens if you lie on an application?
Lies, deliberate misrepresentations or withholding insurance information that’s relevant to your application is insurance fraud. You could face criminal prosecution and a prison sentence if you are found guilty. At the very least, you will find it much harder to get car insurance in the future and it will likely be more expensive.
An insurer might cancel your policy if they feel you haven’t told the truth on your application or at point of renewal on a policy. This could cause you even more of a headache on your next application, as you have to disclose previously refused, cancelled or voided policies.
A policy that is cancelled is valid up to the date it’s cancelled, so any claims already in progress will proceed to conclusion.
In more serious cases, the insurer may have grounds to believe you deliberately withheld or altered important information to get cheaper insurance. In this situation, they may void your policy. This means it will be invalid from the start date, as if it never existed.
If your policy is voided, any claims already in progress will be rejected. This could have huge financial implications for you if you have to settle the costs yourself.
Refused policy / Refusal to renew
An insurer can also refuse to issue or renew a policy because of a non-disclosure or lying on an application about accidents, claims, convictions etc. As mentioned earlier, you must declare, when asked, any instance of an insurance company refusing you insurance or refusing to renew your policy.
A refused policy could make it harder to find affordable car insurance in the future.
Should you tell an insurer about an accident if you didn’t make a claim?
It’s a common misconception that if you didn’t make a claim, you don’t have to disclose the incident on an insurance application. For example:
- You had a minor knock or damage that you fixed at your own expense
- You were involved in an incident where there was no apparent damage to the other car
- The damage to your car was below your insurance excess
This is a myth. If an insurance application asks you to disclose details of previous incidents, you should do so regardless of whether you made a claim. Lying to an insurer about an accident can lead to your policy being voided, cancelled, or refused renewal.
Must you tell an insurer about points on your licence or convictions?
Yes. Details of current points and unspent convictions are important to help the insurer quote the correct premium. If you receive any convictions or points on your licence during the term of a policy, it is vital you let your insurance company or broker know when it happens. Don’t wait until the renewal date.
Can you alter your job title to get a cheaper quote?
We’ve said this before: there’s not much an insurance company won’t analyse to determine a customer’s potential risk when it comes to car insurance. That goes for your job, too!
There’s a fine line between “tweaking” your job title and completely misrepresenting what you do for a living. The first is acceptable, as long as your stated occupation accurately describes your profession, while the second is plainly insurance fraud.
Things drivers lie about on an application
This isn’t an exhaustive list, but these are a few of the more common issues that some drivers lie about.
- Car mods – withholding details of modifications (mods) that add value or increase your car’s performance.
- Class of use – for example, applying for Social Domestic and Pleasure use, when you also use the car for commuting or business travel.
- Fronting – trying to get a cheaper premium for your son or daughter by listing them as a named driver when they are actually the main driver.
- Where the car is parked overnight – for example, claiming that your car is parked on a driveway when it is actually parked on the road
- Claims and convictions – not disclosing all unspent convictions or previous claims.
- Information you might not realise should be disclosed after a policy has started
When should you tell your insurer about relevant information?
Insurance fraud doesn’t just happen on new policy applications. Did you know that you’re also obliged to disclose relevant information to your insurer during the term of an existing policy? And at renewal? Remember to let your broker or insurer know as soon as possible about things like:
- Any increase in your average annual mileage.
- Changes to your address or where the car is parked.
- Changes to your job title or anyone else named as a driver.
- Relevant information about medical conditions that arise after the policy started
- Accidents or damage to your car, especially if a third party was involved, even if you don’t make a claim.
- New penalty points or convictions for yourself or any named driver.
If you don’t keep your insurer updated with this kind of relevant information, they could refuse to renew your car insurance. Your policy may even be cancelled or voided mid-term if it comes to light, perhaps after a claim.
Honest mistakes on insurance applications
Insurers understand that honest mistakes do happen. But even inadvertent errors on an application can lead to a the insurer refusing, cancelling or voiding a policy if they decide they no longer want your business.
The consequences of making a mistake on your insurance application can be as serious as intentionally lying. Take care to have accurate information ready before you begin the quote process.
Will an insurance company know if you’ve lied on your application?
Most insurers these days ask you to share your driving licence details with them. This enables them to quickly check penalty points and motoring conviction records against a DVLA database. That way, insurers don’t have to rely on an applicant’s memory or honesty; they can offer every driver a more accurate premium.
Of course, some drivers lie or withhold information about things that an insurance company can’t check at the application stage. However, if this comes to light later on, perhaps when a claim is made, you could still face the consequences that we outlined earlier.
Don’t worry if you’ve got a less-than-perfect driving history. We’re well placed, through our contacts and our experience, to find affordable quotes for drivers who might struggle elsewhere.