Insurers' pilot scheme checks car condition before cover is issued

Allianz Cornhill and Admiral are piloting a scheme where motorists receive cover only if their vehicles have been inspected.

The pilot, in conjunction with security specialist Toad, will run on the insurers' motor lines business. The idea is to eliminate instances where customers falsely represent the condition of their vehicle when requesting cover.

Toad managing director Nick Grimond said: "The aim is of the scheme is to tackle the problem of people taking out insurance policies when there is prior damage to the vehicle".

Sources familiar with the scheme say up to 20% of customers withdraw requests for cover upon learning that their vehicle will be inspected.

Under the scheme, a Toad engineer will visit a customer to inspect his vehicle. Then the engineer will complete a vehicle evaluation form detailing the condition of the vehicle.

Earlier this year, it was revealed that Toad was running a similar pilot with Royal & SunAlliance.

It is understood that insurers running the pilots choose which vehicles will be inspected either at random or according to risk profiles.

"The scheme enables insurers to ensure a risk is as clean as possible," Grimond said.

Toad currently employs a team of 70 engineers to carry out the inspections. It is estimated that, during the pilots, "several thousand" vehicles will be inspected this year.

Toad plans to automate the scheme so allowing web access.

"We envisage it being a web-based system where the inspector will fill out the evaluation form on a hand-held device," Grimond said.

Toad is aiming to start pilots with a three more insurers by the end of the year.