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Michael Browne

Isurers load premiums for drivers with poor credit

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Insurers caught snooping on credit files to make poor drivers pay more for car cover than rich ones

 

 

 

Britain’s biggest insurers are conducting secret credit checks on drivers and using data to pinpoint claims hotspots in a bid to hike premiums.

 

These tactics supposedly give the firms more detailed information about what kind of driver you are. But increasingly they threaten to push up prices to even more eye-watering levels.

 

The tricks are revealed as fears grow that perfectly valid insurance claims are being kicked out simply based on a gut feeling that drivers are lying about claims.

 

Your credit record contains all your personal information including your history of repaying credit cards, debts and even mobile phone bills.

The theory is that drivers with low credit scores are more likely to struggle to cover the cost of repairing a car — and so would be more likely to claim.

 

‘This is appalling. Insurers are saying poorer people are riskier,’ says Marc Gander, founder of campaign organisation Consumer Action Group. ‘I doubt there are any proper statistics to prove this. It is just insurers looking for another way of grabbing more of our cash.’

 

It is understood that trade body the British Insurance Brokers’ Association (BIBA) is so concerned about the trend it has launched an investigation into how insurers are using these personal details.

 

Graeme Trudgill, head of corporate affairs at BIBA, says: ‘Already if you are unemployed your insurance premiums will be higher because the insurer will believe statistically you may struggle to maintain your car. Doing a credit check would be taking it to the next level.’

 

Britain’s biggest insurer, Aviva, confirmed it ran credit checks on customers to help decide what kind of premium to offer them.

 

Read more: http://www.thisismoney.co.uk/money/cars/article-2222085/Why-poor-pay-rich-car-cover.html#ixzz2BqcdzLQX

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They also load premiums for the unemployed by around 30%, so become self employed instead.

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They also load premiums for the unemployed by around 30%, so become self employed instead.

 

Nah, they charge self-employed a fortune too. I went from unemployed to self-employed, social, domestic and pleasure only, and my car insurance doubled.

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