Motorists who give false information to insurance companies are paying £286 more a year, research released by Consumer Intelligence reveals.
And the price difference is even bigger for young drivers who fake it with under-25s who give false information risking paying an average of £602 more for their annual policy.
The findings will come as a warning to the 32% of drivers who admit to entering false information on price comparison websites when shopping around for a quote — many of whom actually do so in a misguided attempt to lower their premium.
Insurance companies can verify if drivers are who they claim to be by checking their details against databases to confirm if they really live at an address, if their car is really registered at that address, and whether they have lied about previous claims and convictions.
They offer a better price to truthful drivers, because in their experience people who are honest about their address and past claims are less likely to attempt to make a fraudulent claim on their policy and may also be safer drivers.
Drivers who give a fake name and address also have less choice when shopping around. Consumer Intelligence’s mystery shopping exercise found that motorists who provide their real details received a fifth more quotes, as insurers who couldn’t validate their identity declined to make them an offer.
Drivers who lie in their application risk having their policy cancelled and future claims fully or partially rejected. Association of British Insurers figures show around 4,000 false insurance applications are rejected by insurers every week** and about 67,000 fraudulent motor claims worth around £867 million are detected a year.
Notes to Editors
* Consumer Intelligence questioned 2,000 drivers