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When you apply for vehicle insurance, you usually have to divulge a lot of personal information. Your monthly premiums are calculated using information such as your age, residence, and driving history.
It may be tempting to leave out some data or stretch the truth to get the best quote. However, any falsehood in your application, even if they are unintentional, will almost certainly result in you paying more for auto insurance in the future.
If your insurer discovers you lied, they have the option of cancelling your insurance or refusing to pay out on a claim. Worst of all, willfully lying on an application could result in insurance fraud, which is an extremely serious criminal charge.
Things You Should Never Lie About
Car insurance laws vary from state to state, but not to a great extent. How car insurance works in California is different from how it works in Michigan. For example, California is an at-fault state, while Michigan is a no-fault state. It is important to understand car insurance laws in your home state and what to avoid to be on the right side of the law.
Read on to learn about the five most typical lies people say to get a lower insurance quote.
1. Expected Car Use
How people expect to use their car is a common fib they tell on their car insurance applications. The cheapest car insurance option is called pleasure use, and it simply covers excursions to see friends or go shopping.
If you drive back and forth to work in your car, you’ll need to make sure you’re insured for commuter insurance. Such drivers should get insurance that covers their vehicles for both personal and business use. And because you’re likely to be driving during the busiest part of the day, insurance for business use or commuting is more expensive.
Car insurance usually is cheaper for people who have been driving for a long time and have an impeccable driving record. People will sometimes take advantage of this by insuring a car in the name of an experienced driver and adding a named driver who has just passed their test. This is considered insurance fraud by insurers. The primary policyholder should be the individual who will be driving the car the most.
The occupation you list on your auto insurance application may have an impact on the price of your premium. To receive lower insurance, some people may give themselves an inaccurate job title or claim to work in a different field. You should tell the truth to avoid invalidating your policy. Additionally, if you change jobs while your policy is in effect, you must notify your insurer.
4. Withholding Claim History
It can take a long time to enter your accident and insurance claim history into your application, and it could increase the cost of your quote. If you fail to report any events, even if you were not liable or did not file a claim for the accident, your insurance may refuse to pay out on your claim.
5. Lying About Your Driving Offenses
When applying for auto insurance, if you intentionally fail to declare any driving offenses or points on your license, your application will be considered fraudulent. To prevent getting into problems, be honest about your driving record and notify your insurer if you acquire any points while your policy is active.
It’s unlawful to drive without insurance, and any mistakes in your application could result in your insurance being voided. If you lie on your application, you could face a hefty fine or even a criminal record. When applying for car insurance, it’s vital to be honest and update your insurer with any changes to the information you initially provided as soon as they occur.