Car insurance myths that could see you fined or cost your licence

Drivers may risk points on their licence, fines and higher premiums by falling for car insurance myths – and up to 36 million drivers could be affected.

That’s according to new research by Confused.com, which found that 90% of UK drivers believe at least one common myth around the rules of car insurance. In fact, one in three (31%) drivers admit they are confused by car insurance rules, and it’s this confusion that could see them confronted by the law.

According to the research, nearly a quarter (24%) of drivers said they believed you can drive another car if you have fully comprehensive insurance.

But this is not always the case. In fact, if you’re caught without the correct cover, you could be hit with a £300 fine and 6-8 points on your licence – a fact nearly 50% of people are unaware of.

Driving other cars (DOC) cover used to be a standard element of comprehensive insurance for anyone over the age of 25, but this is not the case anymore.

According to Confused.com’s expert guide, motorists must now have DOC on their policy to legally drive someone else’s car, if they’re not a named driver on their policy.

Worryingly, a fifth (20%) of UK drivers don’t know if they have DOC included in their policy, while close to a fifth (19%) said they had driven another car without even checking they were insured. More than a third (36%) claimed they trusted they would “drive safely”.

Being caught without valid insurance isn’t just a case of a slap on the wrist. Looking at drivers who have been stopped by the police without the right cover, 93% were given a fine, points on their licence or both.

Believing in common misconceptions could also be invalidating drivers’ insurance without them realising it.

More than two thirds (68%) of motorists with a past conviction said they didn’t tell their insurer because it was no longer valid.

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Worryingly, nearly two thirds (63%) of these drivers deliberately avoided telling their insurer to avoid a higher premium. And more than a third (34%) refused to tell their insurer because they didn’t think the convictions were “fair”.

But insurers will normally ask for the last five years of convictions, whether or not they’ve expired. Some convictions are no longer on your licence after four years, but experts at Confused.com advise drivers they should still tell their insurer if it falls within the five-year time frame. If they don’t, they risk invalidating their insurance.

Not telling your insurer about an accident – even a small bump – could also invalidate your insurance.

Even if you decide to pay for the repairs yourself, most insurers will still require you to tell them about the incident, a fact more than one in ten drivers (13%) are unaware of. You should make it clear that it is for “information only” and that you don’t want to make a claim.

But falling for common car insurance myths could bring you more than a run-in with the law or your insurer.

Millions of drivers (49.5%) could be increasing their car insurance costs by choosing options which they believe will save them money. Research revealed half of drivers believed in at least one of three myths that suggest money can be saved.

For example, more than a third (34%) of people who took out third-party cover did so because they assumed it would be cheaper – without even comparing it to a comprehensive quote.

Some insurers raise their insurance costs for third-party cover because of the number of higher-risk drivers who sign up for these kinds of policies as statistics skew towards a higher number of claims being made on third-party policies.

Another of the biggest myths that drivers fall for is that driving for business use cover will cost you more than if you just declare for social, commuting or both. In fact, more than a quarter (26%) of drivers who didn’t declare business use when they should have said they did so because they were “worried about the price”.

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If you’re involved in an accident and haven’t declared that you drive your car for business use, your policy could be invalidated and your claim rejected. That could end up costing you more than you would’ve paid for business use in the first place.

Insurers assume that people who use their car for business have more to lose if they damage it, so they are likely to take better care of it, which means they may not necessarily have a higher price.

Another myth involves younger drivers. They may well be counting down the days to their mid-20s in the hope that their car insurance premium will then plummet, but this isn’t necessarily always the case.

Data from Confused.com shows that the average cost does drop by £70 (£1,170 to £1,100) from ages 24 to 25. But this is part of a gradual decline in prices as drivers typically gain more experience.

Drivers should notice the biggest savings as they enter their 30s, with the average premium for those aged 30 at £806, according to Confused.com’s latest car insurance price index, powered by Willis Towers Watson.

Similarly, one in ten (10%) people believe their renewal quote will always be cheaper than last year’s. But research by Confused.com discovered that more than three quarters (77%) of drivers who received their car insurance renewal in the past three months saw their price increase by £44, on average.

It’s clear there’s a lot of confusion surrounding car insurance, putting drivers in some very risky situations. But, in reality, tips and tricks to help reduce car insurance costs could end up costing drivers more in the long run and land them with some very hefty penalties.

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The top ten car insurance myths

1.You’re automatically insured to drive other cars if you have a comprehensive policy

2.Your renewal price is cheaper than the prices your insurer offers to new customers

3.Keeping your car in the garage means lower insurance costs

4.Driving for business use means higher prices than social or commuting use

5.Once you reach 25 your premiums fall dramatically

6.Third-party cover is cheaper than comprehensive

7.Non-fault claims won’t affect your insurance costs

8.You’re always guaranteed a courtesy car if you have an accident

9.I don’t have to tell my insurer about convictions that aren’t on my licence anymore

10.Your insurance covers you for any accident that you cause

Alex Kindred, car insurance expert at Confused.com, said: “The rules around car insurance can be confusing, which is why it’s important for drivers to separate fact from fiction.

“Believing that not telling your insurer about a conviction or risking driving someone else’s car could cost you a lot, both financially and legally.

“We know there are a lot of things to consider when purchasing car insurance, and it can be difficult to know what’s a requirement or not. So we’ve taken a deeper look into some of the most common car insurance myths to help drivers stay on the right side of the law and avoid significant fines.”