6 Reasons Why You Should Never Lie to Your Car Insurance Company

Posted on: September 28, 2020, by :

A car insurance policy is a legal contract between you and your insurance company. Being untruthful can lead to many unfavourable outcomes as well as legal consequences. Besides, it is completely unethical to lie when you share a professional relationship with someone. To get a clearer picture, take a look at what can happen if you lie to your car insurance provider:

6 Consequences Of Lying To Your Car Insurance Company - InsuranceHotline.com
  • Cancellation of Car Insurance PolicyIf you provide any false information while buying or renewing your car insurance policy, your insurer can cancel your policy when they discover the truth. This will happen because the details that you had entered in the proposal form is incorrect making the policy invalid. As a result, your car will be sans any insurance protection unless you buy another policy. Using an uninsured car can put you at the risk of inviting a penalty as it is illegal to drive a car without vehicle insurance.
  • Rejection of ClaimMost car insurance companies inspect a car when a claim is raised to know the extent of the damages. The insurer sends a surveyor who carefully examines different parts of your car. If you had lied to your insurer previously about something or raised a claim for an uncovered risk, the surveyor will come to know the truth while inspecting your car. As a consequence, your insurer can reject your claim entirely and you will have to bear the cost of repairing the vehicle on your own.
  • Payment of PenaltiesIf your insurer finds out any lies that you told about your car while buying or renewing car insurance, your insurer may levy a fine on penalty on you. You may be required to pay a fine to continue with your insurance coverage and prevent the insurer from lodging a legal complaint.
  • Legal Consequences  As mentioned earlier, car insurance is a legal contract between the motor insurance company and the car owner. Any breach in the terms of the contract can put you in legal troubles. The insurer can file a complaint against you for fraud or cheating. If proved, you may end up paying a hefty compensation or land yourself in prison for telling a major lie.
  • Increase in Car Insurance PremiumYour car insurance premium is charged based on the information you provide to your motor insurance company. If you had lied to your insurer to reduce your car insurance premium, it will all go waste if your insurer finds out the truth. This is because the insurance company may charge a higher premium amount to buy or renew your car insurance policy.
  • Denial of Car Insurance in FutureIf your motor insurer finds out about the false information that you had provided while buying car insurance, they can cancel your policy on the accounts of fraud and manipulation. They may also blacklist you from getting any kind of insurance from the company in future. Moreover, a cancelled policy due to manipulation of information can make it difficult for you to get a car insurance policy from even the best car insurance companies in India.