Insurance ‘quirks’ can hit drivers in pocket
DRIVERS could risk paying hundreds of pounds more than they need to for car insurance due to “quirks” in how insurers and comparison websites collect data, according to Which?
The consumer group found that differences between questions asked by car insurance comparison websites and individual insurers can substantially inflate premiums as assumptions may be made about a driver’s circumstances.
Which? said that in one scenario, a motorist was quoted more than £200 extra because an insurer wrongly assumed they had claimed for damage to their vehicle.
When using a comparison website to purchase car insurance, drivers can be asked a single set of questions agreed by insurers rather than answering each insurer’s unique set of application questions.
This can lead to insurers gathering slightly different information about drivers than they would obtain using their own questions.
It can potentially lead to different prices being quoted for the same person, Which? said.
Which? found that while it
is compulsory to declare all recent driving incidents, not all comparison sites let customers specify which led to insurance claims.
It found Confused.com and MoneySuperMarket did not let drivers specify whether they had claimed on a reported incident.
Which? tested a scenario using both websites, where a south London-based driver had damaged his car but not claimed for repairs.
When checking the assumptions made by the insurers offering the 10 cheapest quotes using these two comparison websites, two insurers – Hastings Direct and Churchill – wrongly assumed the driver had made a claim.
When corrected, Hastings Direct lowered its quoted price by £10, while Churchill lowered the premium by £207.
Which? also found “seemingly irrelevant” customer information collected by insurers – such as home ownership, marriage status, or job title – can have an influence on premiums.
A MoneySuperMarket spokeswoman said the website does not control how insurers interpret its data, or any assumptions they make.
She said: “We don’t ask customers to supply the cost of a recent claim as this is often something they will not know in detail.”
Confused.com said: “We work closely with insurers to make sure the questions we ask gives them the information to give an accurate picture of the customer.
“When it comes to incidents that have been disclosed, insurers will validate the information with the Claims and Underwriting Exchange.
“This is a central database of motor, home and personal injury/industrial illness incidents reported to insurance companies which may or may not have given rise to a claim.”
A Hastings spokesman said: “We do give the customer the option to check their data which would enable them to specify further their claims data and disclose more information or to continue with the data they have entered into the price comparison website”.
Churchill said: “Anyone purchasing through a price comparison website who is unsure of what details need to be provided, they can still phone their preferred company to provide any further detail.”