Telling little white lies could mean your insurance claim being turned down

Source: The Independent
Date: 05/09/14
Author: Simon Read

One-in-five of us admit to lying to our insurance company. That’s despite the fact that wrong information on an insurance form can lead to claims being turned down, a fact that four out of five of us know.

Why do we take the risk? Partly because we think it doesn’t really matter – it’s a white lie – but partly because some of us are frightened of the consequences of telling the truth.

“People lie about all sorts of things – from their weight to their employment experience – but the ‘white’ lie is still the most prevalent,” says Dr Patrick Fagan, Lecturer in Consumer Behaviour at Goldsmiths University.

“There is a feeling that the more irrelevant the lie, the less severe the consequences, but this just isn’t true. I think we’d all agree that a little frugality with the truth to avoid upsetting someone is fine, but there are still a sizeable group of people who’d be dishonest in more serious and formal situations.”

Following an increase in fraudulent claims credited to the rise of internet applications, Zurich Insurance asked people when they would lie and why.

It survey suggests that 20 per cent of Brits lie to their insurance company, despite a separate 82 per cent knowing that wrong information registered on an insurance form can render the policy invalid.

However, despite five years of recession forcing people to tighten their belts, the research also found 87 per cent of people would not lie to an official body (such as the police, accountant, council, mobile phone network) in order to save money.

Zurich home insurance expert, Phil Ost, said: “It’s encouraging that most people don’t feel it’s acceptable to lie to save money. The consequences of being found out can be severe and maybe invalidate a policy and potentially result in claims not being paid.”

Brady Burns Insurance Brokers.