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Why stretching the truth on insurance claims is never a good idea

By Paul Baxter, 1st May 2024

Category: Car insurance

It may seem tempting in a cost of living crisis to be ‘economical with the facts’ when taking out an insurance policy, but our research with UK consumers has shown that it can backfire.

While 18% of motorists surveyed said they would be tempted to give false information when applying for a policy, 15% of drivers who admitted to giving bogus details have seen their subsequent claims rejected or scaled back.

Over a quarter (28%) of UK motorists surveyed admit to stretching the truth in order to reduce their car insurance premium. The biggest fabrication, admitted by 21% of drivers, was to understate their annual mileage.

Other fibs include saying that a car is kept in a garage when not in use when it isn’t and falsely claiming to have an immobiliser for their car. Drivers also admitted to stating they had a lower risk occupation or stating that their car was not used for work when it was.

A minority of motorists are likely to continue making false claims on their applications for policies, especially now that premiums are on the rise. When asked what they would be most likely not to tell the truth about, mileage and the use of a fictitious garage were mentioned by 16% and 5% of motorists respectively.

Drivers aged 65 and over appear to be the most honest when applying for cover, with 83% saying they would not provide false information, compared to just 63% of 18-24 year old drivers.

Younger drivers who had provided false information when applying for a policy are also more likely to have had a car insurance claim rejected or scaled back because they were found not to have told the complete truth.

While almost a third (31%) of 18-24 year old drivers who had made a claim said they had a claim rejected on this basis, no drivers aged 55-64 and 65+ age groups had been refused a payout because they had provided false information.

Lying to secure lower insurance premiums is never a sensible idea, because as our research shows, the more likely people are to provide false information, the more likely they are to have insurance claims rejected or at least scaled back.

Of course it can be challenging to pay for motor insurance premiums, especially for younger drivers who are offered higher prices because of their relative inexperience. But a better idea is to avoid stretching the truth altogether and instead choose a policy that exchanges lower premiums for careful driving – and helps protect the environment at the same time.