Car Insurance - Hypothetical not covered
Discussion
For reasons I won't bore people with I have access to expensive cars on very cheap leases.
I'm terrified by the liability. I imagine total destruction of the car and a clerical error in the insurance leaving me with a massive chunk of money I need to fund. It's not like ownership where if I lose the car I just live without the car, I'd need to fully pay for the car.
For instance about 25 years ago 9 months in I realized my reg number was one digit out on my insurance docs, it was corrected and the agent told me I had been covered but I was never convinced.
In theory I ought to have the same concern about the 3rd party element on any car - the liability could be astronomical - but for for some reason I'm less worried about that, perhaps because there's less scope for errors.
So is there an element of common sense? Is there some kind of sliding scale if there are mistakes on an insurance document or do they go over the application and if there are errors just flatly pay out zero?
I'm terrified by the liability. I imagine total destruction of the car and a clerical error in the insurance leaving me with a massive chunk of money I need to fund. It's not like ownership where if I lose the car I just live without the car, I'd need to fully pay for the car.
For instance about 25 years ago 9 months in I realized my reg number was one digit out on my insurance docs, it was corrected and the agent told me I had been covered but I was never convinced.
In theory I ought to have the same concern about the 3rd party element on any car - the liability could be astronomical - but for for some reason I'm less worried about that, perhaps because there's less scope for errors.
So is there an element of common sense? Is there some kind of sliding scale if there are mistakes on an insurance document or do they go over the application and if there are errors just flatly pay out zero?
I think you're overthinking. A simple clerical error by you, the broker or an insurance company should have any effect.
I've had insurers who have typed in the wrong reg GF04ABV instead of GF04ABC (with C being next to V on the keyboard). The only outset would be the the car would appear to be uninsured on the MID database and more likely to be stopped. That said I worked for a company with around 100 mixed vehicles from HGV's to cars and one year none of them appeared on MID despite badgering the broker and insurer, and none of them were stopped.
I think these days we have more common sense approach with the Ombudsman keeping insurers in check. In the past, some insurers would use the No MOT = No Insurance card, and many people fell for it.
I've had insurers who have typed in the wrong reg GF04ABV instead of GF04ABC (with C being next to V on the keyboard). The only outset would be the the car would appear to be uninsured on the MID database and more likely to be stopped. That said I worked for a company with around 100 mixed vehicles from HGV's to cars and one year none of them appeared on MID despite badgering the broker and insurer, and none of them were stopped.
I think these days we have more common sense approach with the Ombudsman keeping insurers in check. In the past, some insurers would use the No MOT = No Insurance card, and many people fell for it.
CanAm said:
These days insurers are hooked up to the DVLA database, and inputting the reg number automatically brings up the vehicle details. There is a very low risk of the reg number being incorrect on low volume high value vehicles.
Ok, so that's reg number, but that's one tiny way it can be wrong. You might say 10k miles a year and you do 11k. You pass your test in 1991 and it turns out it was 1993. You say you don't have access to other vehicles but then you buy another car mid term. I can think of dozens of ways you could mislead in pretty trivial ways.
I think I need to chill out. I'm not surrounded by neighbours who are destitute because their car insurance didn't pay out and I'm pretty sure I'm more careful and accurate with checking my paperwork than any of them.
BikeBikeBIke said:
CanAm said:
These days insurers are hooked up to the DVLA database, and inputting the reg number automatically brings up the vehicle details. There is a very low risk of the reg number being incorrect on low volume high value vehicles.
Ok, so that's reg number, but that's one tiny way it can be wrong. You might say 10k miles a year and you do 11k. You pass your test in 1991 and it turns out it was 1993. You say you don't have access to other vehicles but then you buy another car mid term. I can think of dozens of ways you could mislead in pretty trivial ways.
I think I need to chill out. I'm not surrounded by neighbours who are destitute because their car insurance didn't pay out and I'm pretty sure I'm more careful and accurate with checking my paperwork than any of them.
Adding a car mid term doesn't (I Think) matter as at the point of completing the application you statement was true at that time. The same goes for points on your licence.
BikeBikeBIke said:
Ok, so that's reg number, but that's one tiny way it can be wrong.
You might say 10k miles a year and you do 11k. You pass your test in 1991 and it turns out it was 1993. You say you don't have access to other vehicles but then you buy another car mid term. I can think of dozens of ways you could mislead in pretty trivial ways.
I think I need to chill out. I'm not surrounded by neighbours who are destitute because their car insurance didn't pay out and I'm pretty sure I'm more careful and accurate with checking my paperwork than any of them.
Insurers ask for your estimated annual mileage - it's not written in stone, unless you have a limited mileage policy, when the policy documnet will say exactly what will happen if the mileage is exceeded (mine says cover reduces to Third Party only unless they have been advised and cover is extended).You might say 10k miles a year and you do 11k. You pass your test in 1991 and it turns out it was 1993. You say you don't have access to other vehicles but then you buy another car mid term. I can think of dozens of ways you could mislead in pretty trivial ways.
I think I need to chill out. I'm not surrounded by neighbours who are destitute because their car insurance didn't pay out and I'm pretty sure I'm more careful and accurate with checking my paperwork than any of them.
They also often check licence details. The date is on the back of your licence if you really can't remember when you passed your test.
Despite what the odd poster on here says about Insurers being theiving scum, they are highly regulated by the FSA etc. If a trivial mistake surfaces on a claim, they will usually just charge the extra premium (if any) they would have charged had they been advised.
You're right, you are definitely worrying too much here. Just tell the truth and you'll have no problems. BTW I was a Senior Underwriter and spent my whole working life in Insurance.
BikeBikeBIke said:
You might say 10k miles a year and you do 11k.
So as you hit 10k and need more miles - tell them - onus on youBikeBikeBIke said:
You pass your test in 1991 and it turns out it was 1993.
Get it right - onus on youBikeBikeBIke said:
You say you don't have access to other vehicles but then you buy another car mid term.
Tell them - onus on youBikeBikeBIke said:
I can think of dozens of ways you could mislead in pretty trivial ways.
Probably all in your control - so don't mislead them 
BikeBikeBIke said:
I think I need to chill out.
Correct 
The reality is that most issues come from those who either set out to deceive or who are careless... not difficult to avoid either / both of those approaches
BikeBikeBIke said:
I'm terrified by the liability. I imagine total destruction of the car and a clerical error in the insurance leaving me with a massive chunk of money I need to fund. It's not like ownership where if I lose the car I just live without the car, I'd need to fully pay for the car.
Just to pick up on this point, how does that work?If you've bought a £20k car, which is then an uninsured total loss, you will be £20k down. Is that different to being exposed to a potential £20k loss if the same car is leased?
Mandat said:
BikeBikeBIke said:
I'm terrified by the liability. I imagine total destruction of the car and a clerical error in the insurance leaving me with a massive chunk of money I need to fund. It's not like ownership where if I lose the car I just live without the car, I'd need to fully pay for the car.
Just to pick up on this point, how does that work?If you've bought a £20k car, which is then an uninsured total loss, you will be £20k down. Is that different to being exposed to a potential £20k loss if the same car is leased?
The issue here is if he is leasing the car and he loses it he now has to find £20k to give to the leasing company. That's £20k that he presumably doesn't have and it's probably a lot more than £20k in this instance.
Mandat said:
Just to pick up on this point, how does that work?
If you've bought a £20k car, which is then an uninsured total loss, you will be £20k down. Is that different to being exposed to a potential £20k loss if the same car is leased?
If I have a leased car and destroy it, I'd guess the lease company want the value of that car back. If I buy a car for £20k and destroy it I replace it with a banger and just live with a worse car.If you've bought a £20k car, which is then an uninsured total loss, you will be £20k down. Is that different to being exposed to a potential £20k loss if the same car is leased?
So (rightly or wrongly) I regard the lease car as a potential liability whereas the private car wouldn't leave me needing to find a large lump sum of cash.
If I really *needed* the £20k car I owned I guess that would also be a £20k liability, but I don't.
CanAm said:
Insurers ask for your estimated annual mileage - it's not written in stone, unless you have a limited mileage policy, when the policy documnet will say exactly what will happen if the mileage is exceeded (mine says cover reduces to Third Party only unless they have been advised and cover is extended).
They also often check licence details. The date is on the back of your licence if you really can't remember when you passed your test.
Despite what the odd poster on here says about Insurers being theiving scum, they are highly regulated by the FSA etc. If a trivial mistake surfaces on a claim, they will usually just charge the extra premium (if any) they would have charged had they been advised.
You're right, you are definitely worrying too much here. Just tell the truth and you'll have no problems. BTW I was a Senior Underwriter and spent my whole working life in Insurance.
Hopefully this helps you to stop overthinking it. They also often check licence details. The date is on the back of your licence if you really can't remember when you passed your test.
Despite what the odd poster on here says about Insurers being theiving scum, they are highly regulated by the FSA etc. If a trivial mistake surfaces on a claim, they will usually just charge the extra premium (if any) they would have charged had they been advised.
You're right, you are definitely worrying too much here. Just tell the truth and you'll have no problems. BTW I was a Senior Underwriter and spent my whole working life in Insurance.
Insurers will only try to not pay a valid claim should the customer be found to have deliberately misled or lied to them when the policy was taken out.
Even then it usually has to be a material fact.
Insurance used to be about utmost good faith which works both ways.
That all said obviously you should check all the details supplied on any documents.
alscar said:
Hopefully this helps you to stop overthinking it.
Insurers will only try to not pay a valid claim should the customer be found to have deliberately misled or lied to them when the policy was taken out.
Even then it usually has to be a material fact.
Thanks, that's what I really wanted to know.Insurers will only try to not pay a valid claim should the customer be found to have deliberately misled or lied to them when the policy was taken out.
Even then it usually has to be a material fact.
Thanks, and thanks to canam. I'll stop my fretting.
BikeBikeBIke said:
For instance about 25 years ago 9 months in I realized my reg number was one digit out on my insurance docs, it was corrected and the agent told me I had been covered but I was never convinced.
Well of course you were covered, ffs!I suggest that you read the 2015 Insurance act. That might give you some idea about excruciatingly difficult it is for an insurance co to walk away from a claim.
Basically, these are the steps:
Q1. Have you gained a material advantage from the incorrect info you have provided? A lower premium or better terms? If the answer is NO, that's the end of the matter. Saying you passed in 1991 instead of 1993 will not get you a better deal, so insurers cannot do anything about it.
Q2. If the answer to Q1 is yes, are the insurers convinced, beyond reasonable doubt, that this misinformation that you benefitted from was deliberate lie in order to obtain a lower premium or better terms? If the answer is YES, than they can reject your claim for your own damage.
Q3. If the answer to Q2 is NO, they are not sure beyond reasonable doubt it was a deliberate lie, then had they known the true position, would they have covered you at a higher premium or worse terms. (no higher premium or worse terms is covered in Q1). If the answer is NO, they wouldn't have covered you had they known the truth, even though they think the misinformation was accidental, then they can reject your own damage claim.
4. If the answer to Q3 is yes, they would have covered you, albeit at a higher premium, had they known the truth, then they have to deal with the claim. But they can impose some sanctions. They can ask you to pay the extra premium you should have paid, or as you got a percentage saving by providing the wrong info, they can reduce your payout by the same percentage.
These rules are in the act to cover commercial insurance but have been adopted by all UK insurers for personal insurances.
alscar said:
Hopefully this helps you to stop overthinking it.
Insurers will only try to not pay a valid claim should the customer be found to have deliberately misled or lied to them when the policy was taken out.
Even then it usually has to be a material fact.
Insurance used to be about utmost good faith which works both ways.
This isn't rue, as my post above explains. They can reject a claim due to wrong info being provided accidentally but only if they can show that had they known the truth, they wouldn't have insured you at all. Insurers will only try to not pay a valid claim should the customer be found to have deliberately misled or lied to them when the policy was taken out.
Even then it usually has to be a material fact.
Insurance used to be about utmost good faith which works both ways.
TwigtheWonderkid said:
Well of course you were covered, ffs!
I suggest that you read the 2015 Insurance act. That might give you some idea about excruciatingly difficult it is for an insurance co to walk away from a claim.
Basically, these are the steps:
Q1. Have you gained a material advantage from the incorrect info you have provided? A lower premium or better terms? If the answer is NO, that's the end of the matter. Saying you passed in 1991 instead of 1993 will not get you a better deal, so insurers cannot do anything about it.
Q2. If the answer to Q1 is yes, are the insurers convinced, beyond reasonable doubt, that this misinformation that you benefitted from was deliberate lie in order to obtain a lower premium or better terms? If the answer is YES, than they can reject your claim for your own damage.
Q3. If the answer to Q2 is NO, they are not sure beyond reasonable doubt it was a deliberate lie, then had they known the true position, would they have covered you at a higher premium or worse terms. (no higher premium or worse terms is covered in Q1). If the answer is NO, they wouldn't have covered you had they known the truth, even though they think the misinformation was accidental, then they can reject your own damage claim.
4. If the answer to Q3 is yes, they would have covered you, albeit at a higher premium, had they known the truth, then they have to deal with the claim. But they can impose some sanctions. They can ask you to pay the extra premium you should have paid, or as you got a percentage saving by providing the wrong info, they can reduce your payout by the same percentage.
These rules are in the act to cover commercial insurance but have been adopted by all UK insurers for personal insurances.
Thanks, that's even better - with a source.I suggest that you read the 2015 Insurance act. That might give you some idea about excruciatingly difficult it is for an insurance co to walk away from a claim.
Basically, these are the steps:
Q1. Have you gained a material advantage from the incorrect info you have provided? A lower premium or better terms? If the answer is NO, that's the end of the matter. Saying you passed in 1991 instead of 1993 will not get you a better deal, so insurers cannot do anything about it.
Q2. If the answer to Q1 is yes, are the insurers convinced, beyond reasonable doubt, that this misinformation that you benefitted from was deliberate lie in order to obtain a lower premium or better terms? If the answer is YES, than they can reject your claim for your own damage.
Q3. If the answer to Q2 is NO, they are not sure beyond reasonable doubt it was a deliberate lie, then had they known the true position, would they have covered you at a higher premium or worse terms. (no higher premium or worse terms is covered in Q1). If the answer is NO, they wouldn't have covered you had they known the truth, even though they think the misinformation was accidental, then they can reject your own damage claim.
4. If the answer to Q3 is yes, they would have covered you, albeit at a higher premium, had they known the truth, then they have to deal with the claim. But they can impose some sanctions. They can ask you to pay the extra premium you should have paid, or as you got a percentage saving by providing the wrong info, they can reduce your payout by the same percentage.
These rules are in the act to cover commercial insurance but have been adopted by all UK insurers for personal insurances.
Appreciate you taking the time to post that. I'm golden.
TwigtheWonderkid said:
This isn't rue, as my post above explains. They can reject a claim due to wrong info being provided accidentally but only if they can show that had they known the truth, they wouldn't have insured you at all.
Technically of course you are correct but in reality not sure what wrong information supplied accidentally would then cause them to say we wouldn’t have insured you at all ?Certainly not an incorrect reg plate and certainly not getting the test date pass wrong by a year.
Arguably anything that allows them to suggest had they known their terms might have differed might be dealt with an increase in premium anyway.
The one that will trip people up could be occupation I guess especially where they have perhaps tried to be somewhat disingenuous.
Insurers do not decline claims on a whim.
alscar said:
TwigtheWonderkid said:
This isn't rue, as my post above explains. They can reject a claim due to wrong info being provided accidentally but only if they can show that had they known the truth, they wouldn't have insured you at all.
Technically of course you are correct but in reality not sure what wrong information supplied accidentally would then cause them to say we wouldn’t have insured you at all ?Certainly not an incorrect reg plate and certainly not getting the test date pass wrong by a year.
Arguably anything that allows them to suggest had they known their terms might have differed might be dealt with an increase in premium anyway.
The one that will trip people up could be occupation I guess especially where they have perhaps tried to be somewhat disingenuous.
Insurers do not decline claims on a whim.
I am still trying to get my head around having the wrong reg number on the policy but the correct car.
I mean, everything is on a database but even then, if you are calling them or doing it online then being one digit out could possibly just come back as invalid., or the vehicle is confirmed.
I mean, everything is on a database but even then, if you are calling them or doing it online then being one digit out could possibly just come back as invalid., or the vehicle is confirmed.
Edited by 119 on Wednesday 15th May 16:17
TwigtheWonderkid said:
Possible multiple convictions. Disclosing you have say 2 speeding offences in the last 5 years when in fact a 3rd one that you thought was over 5 years ago but was under 5 years ago. A genuine accidental error but if the insurer covered you with the 6 points disclosed, but can show they never take anyone with 9 points, at any premium, then they could decline the claim.
Yup that’s a very good example - thanks. 119 said:
I am still trying to get my head around having the wrong reg number on the policy but the correct car.
I mean, everything is on a database but even then, if you are calling them or doing it online then being one digit out could possibly just come back as invalid., or the vehicle is confirmed.
The OP said this episode was 25 years ago. Things were different back then - it was all fields around here for a start.I mean, everything is on a database but even then, if you are calling them or doing it online then being one digit out could possibly just come back as invalid., or the vehicle is confirmed.
Edited by 119 on Wednesday 15th May 16:17
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