New research by insurance market experts, Consumer Intelligence, reveals that motorists who give false information to insurance companies are paying £286 more a year.
The findings will come as a warning to the 32% of drivers who admit to entering false information on price comparison websites when shopping around for a quote — many of whom actually do so in a misguided attempt to lower their premium.
Drivers who provide a fake name and address also have less choice when shopping around. Consumer Intelligence’s mystery shopping exercise found that motorists who provide their real details received a fifth more quotes, as insurers who couldn’t validate their identity declined to make them an offer.
Drivers who lie in their application risk having their policy cancelled and future claims fully or partially rejected. Association of British Insurers’ figures show around 4,000 false insurance applications are rejected by insurers every week** and about 67,000 fraudulent motor claims worth around £867 million are detected a year.
Ian Hughes, Chief Executive of Consumer Intelligence says: “Insurance companies can verify if drivers are who they claim to be by checking their details against databases to confirm if they really live at an address, if their car is really registered at that address, and whether they have lied about previous claims and convictions.
“They offer a better price to truthful drivers, because in their experience people who are honest about their address and past claims are less likely to attempt to make a fraudulent claim on their policy and may also be safer drivers.
“Our research warns drivers of the potential repercussions they face by providing false details to their insurance provider, which includes being penalised with higher premiums and less choice of the market.”