posted 3 years ago

Millions Overpay For Car Insurance Having Declared Expired Points

Motorists overpaying for car insurance having needlessly declared expired penalty points.

Millions of motorists overpay for insurance having needlessly declared expired penalty points, The Telegraph reports. When a driver commits an offence any points have a limited period of validity. Those for speeding and driving without due care and attention last 4 years, for example. During this time they should be declared so the insurer can create a profile on which to base its premium. A conviction typically raises the price. On this basis, a motorist that declares expired points – perhaps believing they have not yet expired – appears to be a riskier prospect and might be charged accordingly. Numerous drivers fall into this trap.

Furthermore Martin Bridges, of the British Insurance Brokers Association, told the Telegraph that once a conviction is spent it never has to be disclosed. He said: "This is the case even when the insurer specifically asks the question.” However, he added: “The law doesn't prevent insurers from using an open question such as have you ever been convicted of an offence?" Some, for example, make no distinction during the application between current and spent points and make statements such as: “You must let us know if you've been convicted of any motoring offence in the past 5 years”. 


Sharp Practices

Mike Pemberton, of Stephensons Solicitors said: "Insurers are using sharp practice by carefully wording their questions." He added:  "Customers are asked general questions about their convictions with the warning that if they don't give full information their entire policy will be invalid”. Mr Pemberton concluded: “It's understandable that customers are prone to disclose more than they have to." 

Chris Stacey of Unlock, a charity that helps people with past convictions, said: “The law is a mess and grossly unfair on drivers", the Telegraph reports. He explained: "We now have a situation where a minor driving offence carries a longer rehabilitation period than someone who has gone to prison for assault. Insurers have lobbied to keep the blanket 5-year period for motoring offences because getting rid of it would restrict their ability to charge drivers higher premiums for old offences.”

Upheld Compaints

The Financial Ombudsman – the body that resolves disputes between customers and insurers – could side with the customer if an insurance company behaves poorly. A spokesperson said: "If firms insist on asking questions about spent convictions, then they must effectively ignore the answers they receive. Otherwise we are likely to consider they have breached their statutory duty. Similarly, if an insurer cancels someone's policy because they have a spent conviction they didn't disclose, a complaint will be upheld.”