August 7, 2010

3 Common Mistakes When Filling Out Auto Insurance Applications

It is rare to be outright denied when filing for auto insurance, but there are several mistakes that can lead to receiving terrible auto insurance quotes. There are several mistakes auto insurance companies find that cause them to hike auto insurance quotes. It is important to be careful when filling out insurance applications so that you don't fall into one of these common pitfalls.

The first is deliberately leaving out information. Some people have the mistaken notion that disregarding certain questions on insurance applications will make them more likely to receive a low insurance quote. This strategy typically backfires, as insurers can easily check whether applications present accurate information. In the past, it was relatively easy to get away with evading or misleading insurers while applying for car insurance. This is no longer the case. After the car insurance fiasco of 2008, in which the industry lost billions of dollars due to a lack of verification on policy holders, insurance companies have begun cracking down on applicants and turning down those who lie or deliberately leave out information on their applications. Unfortunately, some people may make honest mistakes but be accused of deliberately misleading auto insurers. For example, reporting the incorrect mileage on a car can result in insurance denial, or even legal action, as misinformation on an insurance application is considered consumer fraud. Be sure to answer all application questions accurately, and then check and double check your application for mistakes before handing it in.

Secondly, keep information up to date. Even if you manage to avoid application mistake, auto insurance information can be inaccurate if it is not kept up to date. A job change, new member of the family or a new house can all affect your auto insurance quote. As such, it is important to update all information with your auto insurance company. If you have any major changes while waiting for an auto insurance company to accept your application, you will want to notify them of such changes as soon as possible so you won't accidentally be accused of consumer fraud.

Third, research the insurance company. Don't fill out an insurance application before finding out how reliable the insurance company is. Common mistakes auto insurance applicants make include failing to find out the reliability of various insurance companies. It is also good to research the types of coverage each company provides and if there are any glaring gaps in coverage. You should know how each insurer you apply with determines auto insurance quotes. You can learn a lot about car insurance companies by researching them online or through word of mouth.