Life would be so much easier and an awful lot cheaper if the world was a place with more honesty in it. But, unfortunately, we’ve always been surrounded by thieves and vagabonds who take goods and money not belonging to them. Why does this matter? Because when the victims are in business, their insurance premiums go up. When their insurance premiums go up, they raise their prices to cover the costs. So we all end up paying more for all our goods and services because the level of dishonesty is so high.
The huge amount of fraud in the system, however, is making it increasingly difficult to find the cheap car insurance we are all looking for. As an example, let’s take the credit-hire companies. These honest and upstanding members of the community buy the personal details of all us unlucky souls who’ve just had an accident. Armed with our personal details, they then approach us and offer a hire car and “cheap” repairs. This sounds a good deal. We’d just started to go round the garages to get quotes. We’d done the internet thing on hiring a replacement vehicle. This looks cheap and easy because we don’t have to pay upfront and claim it back from our insurance company. These nice people do it all for us. Except what a lot of these nice people do is rip off the insurers by inflating the hire charges, storage costs and repair costs.
Why don’t we notice? Because we’ve signed documents authorising these nice people to deal with the insurers on our behalf. So when they issue invoices for storing the car pending repairs when it was on our drive, or double the going rate for hiring a car of that class, or claim to do work which is not done, they are criminals acting in our names. This puts us at risk should the insurers complain and the police investigate. The Office of Fair Trading recently said the car insurance market was dysfunctional and confirmed that all our premiums were being inflated by frauds like this. If you want to keep your cheap car insurance, refuse the credit-hire companies and do the work of finding a reputable garage on your own.