Your car insurance can be invalidated by making a number of simple errors
Car insurance is one of the biggest expenditures when buying a car and represents one of the biggest chunks of annual costs.
Motorists will be on the lookout for methods to slash the overall cost of ownership as prices increase in Britain.
CompareTheMarket.com found that the average cost for the cheapest car insurance has risen from £475 in September 2012 to £650 in September 2018.
Average premiums have shot up by £210 from £550 to £760 over the space of six years. However, in a bid to cut premium costs motorists could be invalidating their insurance cover.
There are a number of factors that go into determining the cost of car insurance cover and requires you to be transparent and honest with your insurer.
If subsequently, an insurer discovers that information has been withheld or given dishonestly then they may reduce or refuse to settle a claim and/or cancel the policy.
If the driver is found to have been fraudulent then the insurer may treat the policy as if it had never existed.
The applicant could also end up in court and find they are unable to get insurance in the future.
Here are five ways in which you could invalidate your car insurance:
1. Class of use
There are three main categories of car usage social; social and commuting; business use. The class of sue determines what you are and aren’t covered for when driving.
Social usage excludes any travel to and from work or other business use so, if you use your car to get to work then you need to make sure your policy covers commuting.
Insurers tend to charge a higher premium for commuting and business use because drivers are more likely to be on the road at the busiest times of the day.
As a way to secure a cheaper premium for a young driver, parents will sometimes put themselves as the main driver and their child as an additional driver.
This will slash the cost of insurance but it also a form of fraud and is referred to as ‘fronting.’
The person who uses the car most often should be listed as the main driver on the policy, additional drivers should only be added if they drive the car occasionally.
Not reporting damage can land you in trouble too
Some jobs are considered as higher risk than others. Your occupation and the way you describe it will impact on the price you pay for car insurance. Being more specific with the title could also save you hundreds of pounds.
You are also obliged to tell your insurer if you change jobs as this could impact your premium cost.
4. Withholding information about previous claims or damage to your car
Drivers are required to declare details of minor knocks, dents, and accidents even if they didn’t claim for them.
5. Failing to own-up to penalty points or other driving convictions
Deliberately failing to disclose driving offences is fraudulent. Drivers should declare penalty points and other motoring convictions when applying for a policy.
Drivers should also notify their insurer immediately of any penalty points received during the term of their cover – rather than waiting until it comes up for renewal.
You have to provide the correct occupation on your insurance document
Lee Griffin, Founder and President at GoCompare commented, “Honesty is always the best policy when applying for or renewing your car insurance.
“To make decisions about your application and the terms they offer you – insurers require information about you, your car and any other drivers who use it.
“Drivers are required to answer all the questions on the application form as fully and accurately as possible.
“A common area of potential misrepresentation concerns claims and losses. Some drivers mistakenly believe that they do not have to declare damage to their car if they paid for the repairs out of their own pocket or for a claim which was not their fault and was settled by the ‘at-fault’ driver’s insurer.
“Typically, insurers require information on all incidents within the last 5 years – so, both of these types of incidents would have to be declared.
Lee continued, “Drivers also need to remember to keep their insurer up-to-date with any changes over the course of their policy. For example, if they change their occupation, receive any motoring convictions or points or make any changes to their car.
“The consequences of withholding or giving false information to obtain cheaper car insurance can be severe. Far from saving money, being untruthful can be costly should you need to make a claim and may even lead to your policy being cancelled or invalidated.
“There are significantly better ways of reducing the cost of your cover – including shopping around at renewal, opting for a larger excess, limiting your mileage or, opting for a blackbox ‘telematics’ policy.”