How does the fight against fraud have an impact on car insurance prices?

There is a difference between a true oversight and a deliberate misrepresentation of address

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It’s safe to say that the Canadian housing market is on fire, with large numbers people who have moved in the past year or are planning to move. The move involves many address updates. While you will have no problem remembering to update your address at the post office or with your bank, it is important to remember your insurance company.

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Insurance fraud might not be a priority when a move is on the agenda, but it is a real concern that people should be aware of. Whether intentional or not, if you don’t update your address with your insurance provider before you move, or if you file a claim at your old address, there could be serious ramifications. Here’s what you need to know about address fraud and its impact on your auto insurance rate .

False claims are on the rise

As reported by Canadian Underwriter earlier this year, “Aviva Canada data shows a 9.1% increase in Ontario and an almost 7% increase in national claims for false address statements, comparing pre-COVID periods (April 2019 -March 2020) to last year (April 2020-March 2021). “

It is a well known fact that the place where you live can have a significant impact on your insurance rate, customers from a zip code potentially paying hundreds of dollars more per year in premiums than someone from a neighboring neighborhood.

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Deliberately distorting your address in order to take advantage of reduced insurance rates may be tempting, but this is an obvious case of fraud and could cause many headaches with your insurance now and in the future.

According to the Financial Services Regulatory Authority (FSRA), those who misrepresent their address (intentionally or not) could have their coverage invalidated (which would be as if you never had insurance, negatively affecting your history), their policy canceled. , see their premium increase in the future, or even be denied future insurance. If you try to make a complaint to your old address, it could be refused or considered fraudulent. If your insurance company decides to take legal action against you for fraud, you could face criminal charges and jail time, if you are found guilty.

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When to update your address

While you want to update your information as soon as possible, you have a grace period to make changes, especially if you move to another province. For example, if you are moving from Alberta to British Columbia, you have 30 days to register, license and insure your vehicle at your new address.

When a policyholder omits information or provides false information in their insurance contract, it is considered police fraud. One of the most common types of policy fraud is misrepresentation of address.

Bryant Vernon, director of claims for Aviva Canada, said insurance fraud is costing us all. In an interview with Canadian Underwriter, Vernon said: “The annual costs of insurance fraud in Canada are estimated at $ 2 billion which are ultimately passed on to honest, mostly loss-free drivers in the form of premiums. higher.

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There are a lot of things that happen with a move, and it can be easy to forget to update your insurance provider on your new details. Mistakes do happen, so be honest with your broker or insurer if you really forgot to update your information in a timely manner. However, it is extremely important that you update your information as soon as possible to avoid being accused of fraud. You don’t want to be left uninsured or accused of insurance fraud due to careless oversight.

Lowest Rates.ca is a free, independent rate comparison website that allows Canadians to compare rates from over 75 providers for a variety of financial products, such as home and auto insurance, mortgages, and credit cards.

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