Why You Should Always be 100% Honest When Applying for Car Insurance
Running a car is an essential for most of us, but it can be a major drain on your finances. Motor insurance premiums are now at their highest levels ever. Last year, they rose by more than five times the rate of inflation and have hit an eye-watering average of £462 a year for comprehensive cover, with many premiums far exceeding this.
As car owners struggle to meet these necessary bills, it can be tempting to look for ways to ‘beat the system’ and reduce those premiums. But you need to make sure you are 100% correct with the information you give to your insurance company when you apply for a quote. If not, you could find your insurance invalidated and you’ll receive nothing if you do need to make a claim – which will cost you far more in the long run.
Follow our guide on applying for car insurance and take control of the costs without compromising your cover.
The little white lie that could cost you big
Figures from The Association of British Insurers (ABI) suggest nearly one in four of us lie when we apply for car insurance. In some cases, it may be unintentional, but others are a deliberate attempt to try to reduce the cost of premiums. These range from concealing penalty points to claiming a vehicle is normally parked overnight in a garage when it is in fact parked in the road.
Failing to give the correct information is considered insurance fraud and your insurance could be invalidated. If a dishonest application is discovered it could also increase your future premiums as it will mark you as a higher insurance risk.
How can you stay truthful and get the cheapest deal when applying for car insurance?
1) Just the job
Insurance premiums are calculated on risk and some professions are considered riskier than others. If there is more than one job title that describes what you do, it is worth trying both to see if it makes a difference to your premium. It’s absolutely essential that the job title you select genuinely does reflect what you do, or your insurance could be invalidated. Not every job title neatly fits the list of professions held by insurance companies. If you’re not sure what to put, it’s always best to talk to your broker for help.
2) Keep your miles down
A popular way to help reduce the cost of premiums is to opt for a restricted mileage policy. It’s important that the figure you select is as close to your normal mileage as possible, because if you go significantly over your stated mileage your insurance may be voided. Don’t be tempted to think that the insurance company will never know – they can check actual mileage using your annual MOT certificate.
This works the other way too. By being as accurate as possible, and not overestimating the number of miles you’re likely to cover, you could find your quote is lower.
It’s also worth bearing in mind that opting for a very low mileage policy could actually see your premiums increase. Whilst logic suggests that the less time you spend on the road, the less chance you have of suffering an accident, some insurers may consider you a higher insurance risk due to less time and experience on the road.
3) Age and experience
Unfortunately, younger drivers who have recently passed their test are a very high-risk group to insure. That means premiums can be huge for younger age groups. If you are the parent of a teenage driver you could feel tempted to help them to reduce the premium by claiming that you are the main driver of the car. This is called fronting and it is illegal. Your insurer will have the right to invalidate any claims and make the policy null and void. That means that you will not receive any payout in the event of a claim, you could be charged with fraud and receive a criminal record, and your child could be considered to be driving without insurance, which will result in a fine, penalty points, and a possible revoke of their licence.
It is ok to put a child as a named driver on a policy held in your name, but only if they are not the primary driver of the vehicle. It’s also ok to name more experienced drivers as additional drivers on a younger person’s policy, and that could help to reduce risk and the cost of the premium.
4) What’s the point?
If you’ve been caught speeding in the past, check the current status of your penalty points. You could be owning up to points that are already spent, and that means you’ll be needlessly paying too much on your insurance as a consequence. Remember to always tell your insurance company about any points or convictions. If you fail to disclose penalties, you will be committing fraud and your insurance will be invalidated.
5) Don’t make assumptions
You might be forgiven for thinking that your insurance premium will automatically be lower if you park your car on a driveway instead of the street. Surely, that makes sense? In actual fact, your insurance could be higher if you park it on your driveway. That’s because of the way risk is calculated. If more vehicles have been stolen or damaged in your area whilst parked on a driveway, compared to on the street, then that will be considered a riskier location.
This anomaly can also occur with comprehensive versus third party insurance. You might assume that third party cover will be cheaper than fully comp cover, but in some cases, it isn’t. That’s because some insurers may consider taking out third party-only cover as riskier behaviour.
6) Bumps and prangs
You don’t have to claim for every accident if you don’t want to, but you should always tell your insurer. In some cases, it might be cheaper to pay for any work as your premiums and excesses will automatically increase after you make a claim. However, you do need to let your insurer know about any accident as this is almost always a requirement of your policy terms and conditions. Simply let your insurer know what happened and state that you do not want to make a claim.
7) That’s the business
If you only use your vehicle for leisure, make sure you tell your insurer so you don’t end up paying extra for a policy that covers you for a commute to work. If you use your vehicle for business purposes as well as commuting and leisure, you’ll need to state that. It’s important to mention business use, even if it’s not very often, as if you don’t your insurance could be invalidated.
Cheap car insurance
The costs of running a car these days are sky high, but you can drive a better deal on your insurance by:
Paying annually. Motor insurance premiums can be high, but they are even higher if you pay monthly as you’ll end up paying interest. If at all possible, always pay your premiums in one go to keep them as low as possible.
Fitting an immobiliser or tracker. Extra security devices fitted to your vehicle could help you to reduce your premiums.
Getting quotes from lots of companies. Busy lives make it easier to just stay with your existing company when it comes to renewals. But that can leave you paying out over the odds. A price comparison website can be a good place to start. But remember that they don’t represent every insurance company out there. These sites also often remove some elements of cover from your policy quote so they will rank higher in the listings and get your attention. You could find that, when you have adjusted your excesses and included essential ‘extras’ like legal cover and breakdown assistance, what first seemed like a great price deal is actually a lot higher than you thought.
Speaking to an expert. Insurance can be costly but looking for the best deal can often secure large savings. An independent insurance broker, like Park Insurance, understands the intricacies of insurance and how to reduce your premiums while always sticking to the truth. We can do all the running around looking for quotes for you, saving you time. And as preferred broker to some of the UK’s largest insurance companies, we are able to negotiate great value prices on reliable insurance cover that won’t leave you with any surprises in the small print.
Call us now for a free quote
Our team of insurance experts has 30 years of experience helping motorists to get cheaper car insurance that can be counted on.
Call us on 0117 955 6835 for a quote.