Insurance Plan part 2

[Tifosi]

Thanks to all the help from those in part 1.

I have now got the ball rolling, I have a friend with a 1991 Mini that has been declared SORN. He has offered to transfer the car into my name. I can insure it (providing I can insure a SORN vehicle) and start to earn some NCBs.

The best part is the car doesn't actually exist. He has had the car scrapped but as far as the DVLA is concerned the vehicle still exists, he has the VIN still and log book.

So technically i'd be insuring a car that isn't there so the insurance company can't make a loss, i dont have to store the car it looks like a win win. Obviously I wont tell the insurance company the car doesn't exist.

Can anyone see any caveats with this plan?

[5lab]

a mini isnt terrably cheap to insure. only hole i can see. better off with a 2cv or something

[nichomach]

Aside from it being (probably) fraud? I'd suspect that it falls under the heading of obtaining pecuniary advantage by deception. You're deceiving the insurance company by stating that you own the car and that it exists, and doing so in order to obtain the advantage of additional NCB to which you would not otherwise be entitled. Incidentally, I was under the impression that where a vehicle was scrapped or sold for scrap, there was a statutory duty to either inform the DVLA if you scrapped it yourself, or for the dealer to inform the DVLA when it is scrapped. I could be wrong and if someone knows better please pipe up, but I think your mate could be on a sticky wicket.

edit: Most insurance policies that I've seen require that you keep the car in good repair and available for inspection at the discretion of the insurer. Tricky...

[Butuz]

I've got a caveat. Its illegal.

Good luck in your quest to defraud your insurance company.

Dont forget that Threads and Private messages are admisible evidence in court, and i am sure a professional companiy such as HEXUS.net would cooperate fully with the authorities in any legal matters that arose......

Butuz

[Rave]

I'm not sure he is defrauding his insurance company; after all he would be paying them to insure him against a nonexistent risk, so they can't possibly lose. I have a car that's taxed and MOTd; I could insure it for a year and get a(nother) year's NCB, but I wouldn't be under any obligation to actually drive it anywhere. I've only done about 1300 miles in the last year as it is.

However, I'm pretty sure that not telling the DVLA that the car has been scrapped is a big no-no, quite possibly punishable with some serious fines. Potentially you could use the now non-existent car's identity to 'ring' a stolen vehicle, so I'm sure there must be a rule against it.

Plus of course, I still maintain that this scheme is pretty pointless anyway. As someone else said in the previous thread, insurance companies go on your age and how long you've had your licence when deciding whether to offer cover for high risk cars, not your NCB.

[nichomach]

He would be committing fraud. The car doesn't exist, and he would be leading them to believe that it did. He'd be doing that dishonestly to gain the advantage of lower premiums through NCBs to which he wasn't entitled. Basically, it's a s16 offence.

[Rave]

Ah, but he would surely have to have demonstrably gained that pecuniary advantage? As I said in his previous thread, I don't believe that he would actually save money by doing this unless he immediately started insuring a very high risk vehicle afterwards (costing £1000+ a year to insure). He wants the NCB so that insurance companies will actually insure him on a performance vehicle, not to save money.

I say again that I can't see the difference from the insurance company's perspective between what he proposes and what I could easily do right now I.E. insure a taxed and roadworthy vehicle and then not drive it anywhere. I tend to skim read my insurance T&Cs now but I'm sure I've never seen a clause saying that you must drive the car you're insuring.

Edit: you say he wouldn't be entitled to the NCB.....why not? He's paid the premium and not claimed, so it seems entirely reasonable that he's entitled to a no claims bonus. If you claimed to be be entitled NCB when you haven't actually been insured without claiming, that would be fraud.

I still don't think this is in any way a worthwhile endeavour, but nonexistent car aside I can't see that it's illegal.

[nichomach]

No, if he's imagining that he'd gain a pecuniary advantage, then that's sufficient. And if the object of the exercise is to get insurers to cover him when they otherwise wouldn't, then THAT'S a pecuniary advantage (whether they will or not). It's not about whether he drives the car or not or whether you do; he's dishonestly claiming that the car exists when it doesn't. And the nonexistent car is the point. It's fraud, plain and simple.

[Tifosi]

Hmmm that's what I thought too, I think I'll be better off taking the other route insuring a car that does physically exist but again not actually using it. In essence it produces the same result just that they differ in the technicalities that the car exists. TBH the insurance company would be better off if the car didn't exist - but I think the legality is questionable.

Thanks Nichomach for that S16 link it is what I have been looking for, I'm not out to defraud anyone.

I was under the impression that where a vehicle was scrapped or sold for scrap, there was a statutory duty to either inform the DVLA if you scrapped it yourself, or for the dealer to inform the DVLA when it is scrapped

I was too under this impression. I haven't been through the DVLA site to check that yet.

[Stoo]

Offical Word:

Buy a cheap car, insure it (even if you don't drive it), job done.

You can pick up plenty of very cheap cars by looking through your local classified ads, it doesn't matter if it's a wreck as long as it's a legally insurable wreck.