ABI Warns Insurers - It's Time to Crack Down on Motorists Withholding Driving Convictions

30th June, 2009

The Association of British Insurers (ABI) is warning insurers to check customers driving records before offering them car insurance, as it reveals as many as 1 in 5 motorists lie on their applications to secure a better deal.

The ABI want to make it possible for insurers to gain access to motorists driving histories prior to offering them car insurance - non-disclosure of offences is on the rise, particularly speeding and other offences such as talking on a mobile phone. Motor fraid has rised from £280 millions in 2007 to £360 million in 2008. Malcolm Tarling from the ABI, said:

"Fraudulent motor claims are on the rise and it costs all policyholders around £30 to £40 extra on their premiums to cover this. We are talking to the DVLA about consent and data protection issues to see if we can get consent at the point of sale."

At the moment, drivers who lie about their motoring offences when they apply for insurance are only discovered when they make a claim, as it's at this point insurers get their written consent to contact the DVLA for details. Insurers would like to see this written consent given electronically when motorists apply for car insurance - as around 70% of policies are bought online this could be set up. Written consent would still need to be gained following a phone application.

Nigel Bartram, a senior motor underwriting strategy manager at Aviva, said:

Andy Goldby, Director of Motor Underwriting at Direct Line, added:"Speeding convictions are not perceived as "bad" convictions or ones that should necessarily be be declared to an insurer. But if a claim is made and the insurer finds out, the payout will either be slashed, by the extra premium the insurer would have charged had it known about the conviction, or turned down."

It is estimated that 2% of motorists are found to have lied on their proposal form when they make a claim.

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