paying/buying online

Motorists who lie to insurance companies are paying £286 more on their insurance premiums, according to research published today.

The report by market research firm Consumer Intelligence found that insurance companies offer a better price to honest drivers because in their experience they are less likely to attempt fraud and may be safer drivers.

The price difference is worst for young drivers who gives false information as they risk paying an average of £602 more on their annual policy.

Drivers who lie in their application are also in danger of having their policy cancelled and future claims rejected.

32% of drivers admit to giving false information on price comparison sites, thinking they will get a better deal withholding information.

But the research found that motorists who provide their real details receive a fifth more quotes than those who give false names and addresses

Insurance companies can verify drivers’ addresses and whether they have lied about previous claims and convictions against databases.

Four thousand false insurance applications are rejected every week and about 67,000 fraudulent motor claims worth about £867 are identified every year.

Consumer Intelligence chief executive Ian Hughes said: “Too many consumers lie about their address, mileage, or how many claims they’ve made in an attempt to reduce their insurance premium. The reality is they’re actually financially worse off for doing it.

“They also risk invalidating their policy, meaning it won’t pay out if they have a claim, if the false information they’ve provided makes a material difference to the insurer’s decision to offer cover. Insurance is a contract of trust and that goes both ways.”