Tackling fraud remains a key strategic priority for the insurance industry. Customers understandably don’t want to pay for fraud through higher premiums. Which is why the MyLicence project is so important – it should make a real difference to motor insurance customers. So we hope that the industry will really get behind this initiative.
From summer next year, MyLicence will enable customers to provide their driving licence data when they buy motor insurance. Insurers will then be able to get data relating to that driving licence such as penalty points, convictions or disqualifications. They can price the policy in full knowledge of the customer’s driving history.
We know that this will have real benefits for the insurance industry and its customers. When we matched industry data with the DVLA it showed that around 1in 6 motorists fail to disclose information about their driving record. That means they pay too little for their insurance. And 1 in 14 motorists mistakingly tell their insurer about motoring convictions that have expired, so they should pay less for their motor cover as a result of MyLicence.
MyLicence will help stop fraudulent non-disclosure of disqualifications or penalty points. And it will mean insurers won’t have to get paper licences from customers which will also bring down costs. Checking details about driving history as soon as a policy is applied for will also mean claims can be processed more quickly. At the moment all these checks happen at the point of a claim being made. Checks can also be made at renewal and on any mid-term adjustments. Importantly, it will enable more accurate risk-pricing, so that premiums reflect the correct driving record.
The industry – through the ABI and Motor Insurers Bureau (MIB) – has been working closely with the DVLA and Department for Transport to get the project up and running. The MIB is creating the hub and ’pipeline’ to the DVLA. Testing will start in February 2014, with the system set to go live in the second quarter of 2014.
Now we have a brand that the industry can adopt as a way of telling their customers about a project that is set to bring clear benefits to the industry and customers alike. We hope that insurers, brokers, comparison websites and software providers will take a look at the information and get in touch with any questions.