According to an investigation, many car insurance companies are hiking their premium members based on their personal information like name and e-mail address. It was further revealed that thousands of pounds are added to the bills on behalf of the information like birthplace, number of children, marital status etc.
In an inquiry, the two persons have everything common but different surnames resulted in a massive quote difference of £1,300. Even the use of another mail server other than Gmail resulted in £391 loss. According to the investigators, car insurance firms made use of the data of previous customers and on the base of that data, they decide premium for new ones.
If according to the previous data, persons with specific names, e-mail addresses, and domestic set-ups have more accidents than usual, the company bumps up the cost for those applicants. An investigation was carried by the Channel 4 consumer who claimed that there were hundreds of car insurance quotes ran by Supershoppers.
Those quotes answered everything same apart from one single detail. The investigation also showed that in one application, the customer with the name David Ledwell got a premium quote of £1,369 which was one more than his name-fellow David Montgomery. After that, another inquiry was made with the name “Ahmad Khan”, which resulted in £462 more as a quote for John Smith.
Many car insurances companies also charge extra for having more children. In one case, £146 was charged for having more children while in another £267 were charged for being single. While commenting on this situation, Roger Flaxman, the insurance mediator told a show that nowadays the insurance business has become heavily data-driven.
Once the company collects data, the question is how it will use it, Roger added. The mediator further said that if a company finds that people with four or more children are more prone to the accidents than those having 3 or fewer children, then there is no one who can stop the company using this data.
When evaluating motor premiums, insurers use a lot of data, The Association of British Insurers said. They also take into account many different things in different ways and all the assumption the made is based on what according to them makes a customer riskier. British Insurers further said that this is what makes the insurance market more competitive and that’s why they recommend people to use their advise of shopping around and get the deal which is best suited for them.
The Association further said that genuine insurance customers never buy an insurance by getting a quote. They also do not tweak the details of the individuals like e-mail address, surname etc and doing so keeps them away from frauds.
There are many reasons that motorists are paying more for their car insurance and one of those reasons includes your bachelor status. If a motorist is not married, chances are he is paying a bit extra for car insurance. According to a report by Customer Federation of America, major insurance companies always charge extra from unmarried people or those who are divorced.
CFA also conducted a study in 10 different cities to get a quote for minimum insurance. The company assumed that the driver is a 30-year-old female and has no accident history. The results of their study were shocking as every car insurance company from all the 10 cities charged same from the driver regardless of the fact that the driver was divorced, single or widowed.
And the premium charged from such drivers is always more than what they charged from married people. CFA also stated that many insurance carriers admit this fact and defend it by saying that married people drive with more responsibility as compared to those who are single or separated. And they also quote the study of 2004 published by National Institute of Health, which stated that single people have higher driving injury rates than the married ones. Those who don’t have their house and living on rent are charged with higher premium rates than those who have their own house.