a simple guide to getting it right when buying insurance

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No Claims Discount Expires After 2 Years | Protected No Claims Discount Does Not Protect Your Premium | Manipulating Your Details to Gain a Better Price Could Invalidate Your Policy | You Don't Automatically Get Driving Other Cars With Comprehensive Cover | Should I Send Copies of Documents to My Broker/Insurer? Yes | Each Policy Earns It's Own No Claims Discount, You Can't Use It Twice | Insuring Your Child's Car In Your Name Is Called Fronting And Is Fraud! | Don't Assume Your Company Car No Claims Discount Will Be Accepted By Your New Insurer - Check First! | Counterpart Licences Abolished, You May Still Have To Provide a Code From DVLA to your Underwriters to Check Your Details | Motorbility Policies Do Not Earn a No Claims Discount | Motoring Endorsements Are Declarable For 5 Years

Have you  ever played around on a price comparison site and adjusted things to better your premium? Reduced the annual mileage because it made the premium cheaper (“How will they know?”)

This is Quote Manipulation - and it’s fraud!.Have you ever insured a car in your name as the main driver when it's really for your son or daughter to drive because it made the premium cheaper?

This is known as Fronting and it is illegal, because it’s fraud.


Ever, removed a claim or conviction? (“C'mon, it's nearly 5 years ago, I'm not going to claim anyway?”)

This is Fraud!


These are all defrauding insurers, as well as organised crime staging claims to rip off insurers for large injury claims. This costs the industry an estimated £2 Billion every year adding about £50.00 a year to your motor policy - are you contributing to this?


Insurers and brokers can get the quotes sent to them automatically when you have run your details through a comparison site, so whether you buy the policy or not they will have a record of each time you change something. If they get through 10 quotes from you, 4 with your claim and 6 without they can tell you have been manipulating the quotes to gain a better price and could contact you for the correct premium or query why you removed it, should you then go on to buy a policy from them “Hey, thanks , I just won't put it on there in the first place, then they'll never know, right?” - Wrong!.


All insurers and brokers can have access to the Claims and Underwriting Exchange (C.U.E. Database), a database of claims that insurers use to log whenever they deal with a claim or have one reported, so if you don't put the claim in they'll still find out and this could have repercussions for you - voided policy, claim not dealt with, points on your licence or driving ban, increased future premiums and insurers refusing to insure you as you have had a policy cancelled or voided.


Insurers and brokers are very good at combating fraud and a lot of them employee ex-police officers, who have a nose for when something is not quite right. Often insurer might appoint loss adjustors on larger claims to investigate the finer details and report back to the insurers with their findings. They can tell a real claim from a bogus one.


If you are not going to give the right details, why bother buying insurance? Just so you can prove you have some and buy road tax? The same applies to all other types of insurance and it's probably why people think insurers just look for ways not to pay, when in reality it's because people don't give their insurance the attention it needs. This is generally speaking, but those of you who don't spend a bit more time when buying insurance are the ones who may come unstuck when trying to claim.


The insurance industry is fighting back against fraud, from simple quote manipulations to organised gangs staging “Crash for Cash” claims. There is a Police Task force (IFED) City of London Police who specialise in Insurance Fraud Investigations. In addition to this insurers and broker have vast amounts of resources available to them such as the following, just a few organisations battling insurance fraud listed below (will open in a new window).


 www.ifig.org/

 www.insurancefraudbureau.org/

 www.gov.uk/government/organisations/driver-and-vehicle-licensing-agency

 www.mib.org.uk/

 www.theifr.org.uk/en/

 www.mib.org.uk/managing-insurance-data/mib-managed-services/cue-miaftr/

 www.cityoflondon.police.uk/Pages/default.aspx

You will probably have an image of a fraudster being a devious and shady character and you would mostly be correct, but could you pick one out of a line up? Organised criminals and gangs stage claims or cause them to get compensations money, but also there are Ghost Brokers, people pretending to be insurance brokers, taking your money and the buying a policy from a reputable broker or insurer with the wrong details as they. They charge you a higher premium and then buy it on details they know will make the premium lower. You get your certificate etc, but the insurance could be worthless as your details are incorrect.

So, in light of the above, if you enter your details incorrectly or by accident, does that make you any different to a fraudster? Yes, you didn’t deliberately do it, did you? But, just changing details to try and better your premium could be seen as fraud, because you are manipulating your quote and bending the truth. You may see this as your right to better the premium and there is no victim to this. Well actually there is a victim, the insurer, as you are depriving them of collecting the correct premium and as such this is fraud and that is a crime against the insurer. Often, if found out the insurer will look to correct the policy and collect the difference from you which might add a fee as well. Or they could cancel your policy if they believe you have deliberately changed your details to gain a better premium.

Worst case scenario is your insurer doesn’t find out about you playing around with your details and you have a claim, they investigate and find they may not have insured you on the correct details. The insurer has the right to void your policy from inception and keep all of the premium you have paid. If you have hit another vehicle, property or person, your insurers would have to deal with the claim for the Third Party under the Road Traffic Act element of your insurance. Okay, so you might be thinking at least the other party isn’t going to come to me for damages, I’ve just lost my car. Not quite, your insurers have the right of recovery against you, therefore, if they have paid out for damage to someone else's property they will look to recover these costs form you. Now imagine if someone was injured, this is where the costs can be massive. They can put a claim against your property (if you own it) to recover these costs as personal injury claims can run into the thousands of pounds for compensation and solicitors fees.

Could You Spot a Fraudster?