Why it is Best not to Lie!

Friday, March 5, 2010

Research carried out by Royal & Sun Alliance revealed a worrying statistic. The survey found that nearly 20 per cent of those applying for life insurance lie in their applications. This is not a great testament to the honesty of British residents!

The research gets worse. Just shy of 50 per cent of those surveyed, stated that they would lie to their employers, with 40 per cent admitting that they would lie to either neighbours or friends.

The results that 20 per cent of customers lie to their life insurance providers, indicates something more serious is happening. Firstly, it is simply fraudulent and secondly hugely risky, as if found out, a claim is more than likely to be rejected. The results of a rejected claim could be devastating. Families could find themselves in deep water financially and in certain cases, when mortgage payments cannot be paid, homes will be lost.

The details are vital. Even if you under-state how many units of alcohol you drink per week, your policy could be rendered invalid if the life insurance provider discovers the truth.

Many think, foolishly, that they won’t get found out if they lie; however, it takes one phone call to your doctor by the insurer to obtain the truth about your health at the time of application.

In addition to this, those that lie are not playing fair. Life insurers understandably have to cover the costs for paying out on fraudulent claims, which amounts to £1.5 billion each year. When this is broken down, the honest policyholder is paying 5 per cent extra on their premiums to pay for those that lie.

Adam Gillespie