1 in 3 Lie for Cheaper Auto Insurance

If you told “little white lies” when you applied for car insurance, you are not alone. When filling out an insurance application, 42% of men and 27% of women lie for cheaper auto insurance. As a follow-up to our post Will My Auto Insurance Company Find Out?, we are summarizing information from a study done by Carinsurance.com.

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Among the drivers reporting a lie for cheaper auto insurance – and many reported more than one — the most common were:

1. Annual mileage: 36.3 percent
2. Where car is parked:  32.4 percent
3. Names of drivers with access to vehicle: 25.1 percent
4. History of tickets or accidents: 20.5 percent
5. Gaps in insurance coverage: 19.2 percent
6. School grades, or teen driver’s grades: 18.9 percent
7. Anti-theft devices on the car: 17.4 percent
8. Primary type of use (such as business, school or work):  17.3 percent
9. Education level: 16.9 percent
10. Marital status: 16.9 percent
11. How long they’d been licensed: 15.8 percent
12. Major modifications to their car: 15.7 percent
13. Refresher or defensive driving courses: 14.4 percent

What Happens to Those that Lie for Cheaper Auto Insurance?

More than 40 percent of those who lied said their insurance company eventually discovered the bad information. Of those caught:

• 33.5 percent said their claim was denied
• 31.5 percent said their premiums went up
• 25.4 percent said their policy was canceled
• 7.6 percent said they were sued for fraud
• 2 percent said nothing happened.

The greatest concern for the person buying the insurance should be if the lie doesn’t get caught in the application process. When caught in the application process, it is merely embarrassing. However, the consequences for lying can be severe. Consequences can include: insurance cancelled, a claim denied or being sued for fraud.

Actions Some Insurers are Taking

The most frequent lie is annual mileage driven. Many insurers are taking actions to not use input from the vehicle owner or driver about how much they drive. Instead, they are rating vehicles based on an overall average mileage. To have this adjusted, they require a cell phone app or telematics device. This is one way for insurers to fight back against these lies.

In today’s world it is becoming increasingly easy to find out detailed information on others. Your insurance company knows this, and is mastering the techniques of catching those little white lies. Catching those people who lie for cheaper auto insurance is a priority for insurance companies. For you, honesty is the best policy. Tell the truth on the application and sleep peacefully at night.

Now that you know your insurance company is checking you out, you should check them out as well. It’s easy. Click the button below and get a free rating on your insurance company. If your insurance company scores well, recommend them to a friend. If they don’t score well, find a new insurance company.

ValChoice does not get paid to rate insurance companies. ValChoice rates nearly every auto and home insurance company in the industry. The rating system uses high-quality data collected by state departments of insurance. Ratings include an analysis of value, claims handling and service.

Some Consumers Just Want the Best

Are you a quality and value shopper? If so, go to our five best insurance company pages. We list the five best companies every state. Shopping only the best saves time and ensures you get a high quality insurance company.