AA reveals motorists concerns about bogus claims - 46% would consider a dashboard camera

An AA Motor Insurance survey of almost 10,000 people reveals that more than 46% of people would consider using a dashboard camera to protect themselves and for greater peace of mind in the event of a personal injury claim.

AA Consumer Affairs Director Conor Faughnan said, "There is no doubt that it is a driver's nightmare to be innocently involved in a minor collision only to find a major claim is being taken against you."

AA Insurance included the question in its most recent poll of motorists because the issue was highlighted, rather strangely, by the amount of remarkable footage of the meteor strike in Chelyabinsk, Russia last February. The reason so many dashboard cameras caught that event is because Russians have taken to the technology in a big way to protect themselves against bogus crash claims, and it is clear that Irish drivers think this is a good idea as well.

"Ten years ago we had a serious problem with the 'compensation culture' in Ireland. It was a key reason why our motor insurance was so high at double the typical cost of the UK," said Mr Faughnan.

The AA is concerned that the number of injury claims is creeping back upwards again despite fewer road crashes and a reduction in traffic volumes in the economy downturn. According to data from the Personal Injuries Board claims numbers increased by 5% last year and are up by a quarter since 2007.

"We have been here before and we do not want to go back. It will wind up costing every motorist money in rising insurance costs if we don't control it. Certainly we do not want to see the emergence of 'claims-farming firms' as has happened in the UK. These are as insidious and unwelcome as 'payday loans' and we do not want them in Ireland," concluded Mr Faughnan.

We are recruiting!

We are looking for a Estimator and a Panel Beater..

ESTIMATOR

Salary: TBA
Description: We are currently conducting interviews for an estimator who is proficient with Audatex and Glassmatix you would also need to hold a current ATA VDA Certificate.

Deadline: 01/05/2013.
Contact name: Terry or Chris.
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PANEL BEATER

Salary: TBA
Description: We are currently conducting interviews for an experienced Panel Beater, you must be competent in Jig Work, Strip & Fit and Welding, you will also need to hold a current ATA certificate for Met and Welding.


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Drivers ‘Will Not Be Declined Car Insurance’ If They Fail To Disclose Information To Insurers Under New Consumer Insurance Act

Drivers taking out new insurance products will be given ‘added peace of mind that their claims will not be declined’ if they unknowingly fail to tell insurers everything about their lives.

Under the new Consumer Insurance Act, which comes into force on April 6, it will formalise the process of insurers asking ‘specific questions about information they need to know’.


“We want customers to take out insurance policies with the confidence that they are covered,” explained Otto Thoresen, Director General for the Association of British insurers (ABI). “By placing a legal duty on insurers to ask customers all relevant questions at point of sale, people will know exactly what they need to disclose upfront.”

Under the new Consumer Insurance Act, insurers have a ‘duty’ to ask customers all the relevant questions about the specific information required to value their car insurance.

It will also provide legal protection for motorists, with claims not being declined for not disclosing information – unless the information is ‘deliberately or carelessly withheld or misleading’.

“This Act reflects steps taken by the industry over the years to improve customer awareness of what they need to tell their insurer,” Mr Thoresen added. “For example, the ABI Code of Practice for life, critical illness and income protection insurance, which helped reduce the number of claims declined for non-disclosure.”

The new Consumer Insurance Act does not only cover car insurance, but also home, travel, life, critical illness and income protection insurance, health and pension annuities.

And it does not matter how motorists purchase their car insurance – online, telephone or even face-to-face – as the new rules still apply.

Whether anything will change in reality remains to be seen but it will require insurers to retrain staff and motorists are sceptical as to whether the Consumer Insurance Act will make any positive difference.

Experian - insurance fraud more than doubled since 2007

The level of fraud on insurance policies has more than doubled since the start of the credit crunch, and the ongoing squeeze on household finances is likely to lead to more cases, a credit reference agency has claimed.

Figures from Experian show that since 2007, the number of fraud cases involving insurance policies has increased more than two-fold, from 5.44 in every 10,000 cases in 2007 to 12 in every 10,000 in 2012.
In this sector, 86% of frauds involved the person applying for the policy or making a claim.

Across the board, Experian said the group responsible for the most fraudulent applications for financial products in 2012 was a group it classifies as "Terraced melting pot".
This group, which represents people in routine urban occupations, was responsible for 21% of first-party fraud cases over the year.

The "Liberal opinion" group, which consists of young professionals and well-educated people, came next accounting for 14% of first-party cases. In total, about 70% of financial services application fraud was down to first parties misrepresenting their circumstances.

Experian said it expected fraudulent applications to continue to rise throughout 2013, driven by the ongoing squeeze on household incomes and benefits, and stricter credit and lending criteria.

"As a result of poor or patchy credit, more and more 'non-professional' fraudsters are clearly attempting to ease their position, misrepresent applications or make exaggerated claims over their income and personal finances," said Nick Mothershaw, UK director of identity and fraud at Experian.

"Mortgages, current accounts, insurance and cards will continue to come under pressure from fraudsters keen to get their hands on cash facilities."

Whether or not to protect your NCD (No Claims Discount)

• Not protecting a car insurance no claims discount (NCD) could lead to premiums rising by 30% in the event of a claim
• Protecting a five year NCD will add just £23 on average to annual premiums
• Costs will vary greatly between providers, warns MoneySupermarket

Drivers making a claim on their motor insurance policy, with an 'unprotected' no claims discount (NCD), could see the cost of their premiums increase by as much as 30% if they make a claim, according to research by MoneySupermarket.com.

The UK's number one comparison site analysed the cost benefit of protecting or not protecting a no claims discount.

The research reveals if a motorist who had five years 'unprotected' NCD and made a claim, they would see premiums hiked from £322 to £417, an increase of £95, or 30%.

However, motorists with five years protected NCD making a claim would only see an 8%increase, or £28 - from £345 to £373 - to the cost of their annual premium.

Furthermore, the average premium for motorists with zero years NCD stands at an expensive £700 a year.

Peter Harrison, car insurance expert at MoneySupermarket, said:

"Having reached the "Holy Grail" of five years no claims discount, many motorists will be reluctant to run the risk of losing it and may consider paying extra to protect it.
Building up your no claims discount over a number of years can be a valuable commodity and can help reduce the cost of your premiums.

"With premiums on average rising by almost a third (30 per cent) if you make a claim, paying extra to protect your policy against this hike might be worthwhile.

"But be warned, if you protect your policy but don't make a claim for a number of years, you could find that you are eroding any potential savings."

TIPPING POINT: PROTECTED NCD vs UNPROTECTED NCD 

Motorists looking to 'protect' a five year no claims discount (NCD) will pay an extra £23 on average on top of the cost of their annual car cover, however this can vary widely between providers ranging from around £4 to over £34.1

The longer a motorist protects their NCD and doesn't make a claim, the less cost-effective it becomes.
In the first year, for example, a motorist who protects their five years NCD, and makes a claim, will be £21 better off on average, compared with a motorist who made a claim on an unprotected policy.
However, the tipping point comes in the second year when a motorist would be £2 worse off. Looking forward into the third year, motorists protecting their NCD would be almost £25 worse off.

Pete Harrison said: "If you are looking to protect your no claims discount, shop around for the best deal available for your circumstances and if you do find a better deal with another provider, you can take your no claims bonus with you.

"It's crucial for motorists to understand the costs involved with premiums; additional fees for protecting a no claims discount entirely depends on your personal circumstances and motoring history, as well as the provider.

"Furthermore, in the event of a claim, many insurers will take to a sliding scale when it comes to reducing your no claims discount.
How much of this you will lose is down to your insurer so read through policy wordings first so you know where your no claims discount will stand.

"Finally, motorists should remember it is the discount they are paying to protect, not the premium amount- so if you do make a claim, it is likely premiums will rise as a result anyway."

Car insurance doubled after 'phantom crash'

A pensioner said his car insurance premium doubled after a "phantom crash" with a bus.

Mike Brown, 69, received a call in May 2011 from his insurers Toyota to say he had been involved in the collision two months earlier.
(ABP - the date is correct, however the story has only been released today.)

When he dismissed it they apologised, only to ring back three weeks later saying they had CCTV of the incident on March 18.

The insurers said his Toyota Avensis pulled out from a bay in front of a First bus causing it to brake hard.

They said as a result a passenger on the bus had gone to hospital four days after the incident and undergone medical treatment for an eye injury.

Mr Brown lives near the site of the alleged accident so accepted in good faith that if there was CCTV it must have happened.

"I could not possibly remember whether I had been in that area two months ago," Mr Brown said.

"I trusted that if they were saying it was my car on the CCTV then it must be but wish I hadn't now. I had no recollection of the incident.

"When I apply for insurance now my driving record says I pulled out in front of a bus and hit a third party.

"That certainly is not the case. I accept that it's possible I was there but even if I was I certainly didn't hit or get hit by another vehicle.

"If I was involved in an accident there is no way that I would not have stopped at the scene for a start.

"I am cross that I didn't insist on seeing the CCTV. I have asked for statements from the scene because I would expect the police, ambulance and the bus driver to have reported it but I have had nothing."

The resulting claim was for £7,748.

Mr Brown, who has driven for almost 50 years, added: "Now when I search for insurance the incident always comes up and I am given much higher quotations that are sometimes double what they used to be.

"I feel like I have been in a phantom crash that is costing me a fortune."

A spokesman for Toyota Motor Insurance said: "An incident occurred on March 18, 2011 which resulted in CCTV footage being sent to Toyota Insurance via a bus company as a result of a passenger sustaining injury when one of their buses had to execute an emergency stop.

"The policy holder involved was contacted by letter explaining the circumstances and how he could view this footage at his local bus depot to see the incident for himself.

"No contact took place between the two vehicles.

"Liability could not be disputed on the basis of clear visual evidence from the event and another witness.

"A claim was subsequently settled and as with any motor insurance policy on the market today the premium will increase for the policy holder in such circumstances."