Is your car insurance worthless?

Telling a ‘little white lie’ can’t hurt, can it? It seems that when it comes to applying for car insurance policies many of us are willing to bend the truth in order to secure cheaper premiums.

New research from a car insurance comparison website has revealed that one in four British motorists lie when making a car insurance application. Fabricating details is a clear effort on the driver’s behalf to cut costs and can range from the seemingly innocent to the quite severe.

For example, one in ten pretend to park their vehicle in a more secure area than where it is actually parked – such as in a garage. One in twenty admit to supplying incorrect information to their car insurers about mileage distances travelled, the value of the car and their reasons for using it. Meanwhile, a worrying one per cent of the nation’s drivers go as far as to lie about where they live, the address they live at or their criminal convictions.

Clearly we have a blasé attitude towards telling the truth to our insurers. Whereas 98 per cent of people surveyed claimed they were honest overall, almost half put insurance fraud on a par for severity with ‘stealing a chocolate bar’ or ‘travelling without a valid ticket’.

Why it pays to be honest with car insurance

Car insurers measure premiums on risk factors. These can range from where you live – it would cost more to insure a car in a high-crime area; to the car you drive – the faster the car, the higher the premium; to your own record as a driver.

The more risk you pose to the insurer the higher your premiums will be. You might not think that’s ‘fair’ if you have an immaculate driving record, but a car insurance company will base judgments on statistical analysis and if it is willing to offer you huge payouts in the event you are involved in an accident or your car is stolen, then it’s only fair that it gets an honest assessment of how likely it is to have to dig into its pockets.

Whereas UK drivers are legally obligated to drive with car insurance, insurers are under no obligation to offer quotes. In fact many car insurers are now refusing to insure young drivers altogether, as they are deemed too high a risk.

It can seem like a neat trick to tell a few untruths to an insurer in order to secure a cheaper car insurance premium. However, it will almost certainly backfire should a claim be necessary.

For example, if you tell your insurer your car is parked in a garage overnight and it is then stolen from a high street at midnight your insurer will almost certainly refute your claim. The same applies if you agree to a mileage restriction with the insurer which you duly exceed or you make modifications to your car and then have an accident as a result of speeding.

Perhaps it’s worth asking yourself therefore, if it’s really worth taking the risk? No matter how good a driver you may deem yourself to be you can’t be responsible for other road users – nor for car criminals who may wish to steal or vandalise your vehicle. Is it really worth saving a few pounds a year by lying to your insurer when you could throw away thousands of pounds in the event that a car insurance claim is necessary?

How you can save money on car insurance the honest way

It’s natural to want to find the cheapest car insurance quote you can – but there are ways of achieving this objective honestly.

If you believe your existing car insurance premium is too high then shop around for another quote. Even if your current car insurance deal was the cheapest when you took out the policy it won’t necessarily be today. By shopping around with a car insurance comparison tool you can gain perspective on the prices you should be paying.

Further savings can be made by paying annually instead of monthly, therefore cutting out interest charges. It’s also looking at all those things you were tempted to lie to your insurer about and seeing if you can apply them honestly. For example, could you park your car in a garage at night? Could you fit an alarm or immobiliser? Could you agree to an honest mileage limit?

Even if you have driving convictions to your name there are still ways to save. Car insurance companies evaluate car crimes, such as speeding, in different ways – so shop around and you could find cheap car insurance elsewhere.