20 July 2020, New Zealand – Thousands of Kiwis are at risk of having their car insurance claims rejected, according to research by Finder, a car insurance comparison site that has recently launched in New Zealand.
According to a Finder survey of 2,143 respondents, one in six (15%) New Zealanders have admitted that they were not
totally truthful when it came to their car insurance applications.
This is equivalent to 552,000 New Zealanders who have lied on their applications.
Of those who were dishonest, one in three (36%) falsely claimed that they park their car in a garage when not in use.
A further 28% of those who admitted to lying on their application failed to list a driver on their policy.
Rounding out the top three insurance lies is underreporting the distance driven, with 16% of Kiwis knocking a few
kilometres off their car insurance application.
Kevin McHugh, Finder’s publisher in New Zealand, has warned drivers that being deceptive on their car insurance
application is going to hurt them down the track.
“Insurers do not take kindly to dishonesty. What may seem like a little white lie can end up costing you big if you need
to make a claim.”
“The trap that people fall into is the prospect of a cheaper premium, combined with an ‘it won’t happen to me’
attitude.”
“This is a recipe for disaster that can leave you uninsured and out of pocket.”
The research found that the most common lie told by Baby Boomers, Gen X and Gen Y is about where their car was being
kept. 52% of Baby Boomers said their car was parked in a garage when it wasn’t, while 45% of Gen X made this claim, as
well as 39% of Gen Y.
Failing to list a driver was the most common lie told by Gen Z where 30% of respondents admitted to doing this.
Gen Z are also the most likely to lie about the age of the driver, with 20% claiming they have done so. This is compared
to 18% of Gen X, 11% of Gen Y and just 7% of Boomers.
The Insurance Fraud Bureau estimates that insurance fraud in New Zealand has cost policyholders upward of $400 million across all insurance
categories this year alone.
McHugh said that failing to declare information in your application can be considered non-disclosure when you come to
make a claim.
“Honesty really is the best policy when applying for car insurance. There are other ways to lower your premium price
that won’t come back to bite you down the line. Opting for a higher excess, parking your car securely under a carport or
in a garage, and installing an alarm can all help to decrease the cost of your premium.”
“If you are unsatisfied with the cost of your premium, shop around and compare your options because a better deal could
be just around the corner.”
Visit Finder to learn more about choosing the right car insurance.
Most common lies told by Kiwis on their car insurance applications*
I claimed the car was parked in a garage when it wasn’t
36%
I didn’t list a driver
28%
I underreported the kilometres driven
16%
I lied about the age of the driver
15%
I registered a business car for private use
11%
I lied about the address
10%
Finder NZ survey (tick all that apply)
*Calculated as the % of those who admitted to lying on their car insurance applications
Tips for saving money on your car insurance
Take advantage of discounts. When looking at providers, check to see if there are any discounts available. This could be a loyalty discount, a new customer discount, or even a discount for signing up online.
Pay a higher excess. Insurers assume that if you are willing to pay a higher excess that you are less likely to make a claim. This will help
bring down the cost of your premiums. Make sure you’re able to cough up that higher amount if you were to make a claim
though.
Restrict certain drivers. If you can be sure that your car won’t be driven by high risk drivers such as learners or under 25s, this will often
lower your premium. It is important to note that if your car is damaged while being driven by a restricted driver, you
will not be covered so consider this option carefully.
Compare your options. Doing your research pays off so be sure to get quotes from a number of insurers to get an idea of what’s out there. If you’re not happy with your cover, don’t be afraid to switch!