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Reasons Not to Lie to Your Insurance Company

A Caucasian child performing a lie detector test to an African-American child and illustrating reasons not to lie to your insurance company.

Every April 30th, it’s National Honesty Day. The writer M. Hirsh Goldberg, who wrote The Book of Lies: History’s Greatest Fakes, Frauds, Schemes, and Scams, created the holiday to counteract April Fool’s Day.

Celebrating the holiday has three requirements. First, you answer all questions you’re asked truthfully all day long. Second, you disclose any long-held secrets or feelings you’ve been wanting to share with someone. Third, you engage in the highest level of transparency you can in the workplace.

For many of us, living our life with this amount of openness is a challenge. We tell white lies. We fudge numbers on our taxes. We don’t share certain tidbits of information. In other words, we aren’t as honest as we could be.

In day-to-day life, those fibs don’t often come back to bite us. However, when it comes to dealing with your insurance company, they definitely will. The consequences could be very significant. Therefore, in honor of National Honesty Day, we’ve created a list of the top five reasons you shouldn’t lie to your insurance company. Read on to learn more.

1. Lying Can Void Your Policy.

Let’s say you have a medical condition. It’s not serious but it’s still pre-existing. You inadvertently (or purposefully) omit the condition from your health insurance application. Then, through a series of unfortunate events, it comes to light that you’ve had this condition, known about it, and didn’t disclose it. This omission could void your health insurance policy.

2. Lying Won’t Get You Low Cost Insurance.

It’s not uncommon for people to minimize past indiscretions, such as driving infractions, on their applications for auto insurance. Most people do this in order to get a cheaper auto insurance quote. Without direct evidence of an infraction, they think their insurance company will provide them with inexpensive auto insurance. Unfortunately, this evidence often surfaces, resulting in a much higher auto insurance quote than you might have expected.

3. Lying Can Cause Your Insurance Company to Deny Your Claim.

Many people get away with lying until they file a claim. For example, you haven’t accurately listed where you park your car in your auto insurance policy. You live in a downtown neighborhood where there’s occasionally a break-in. A few blocks away, there’s a wealthy suburban neighborhood with a car garage. Instead of saying you park outside of your home downtown, you fib and say your car’s in the safe garage. Then, someone breaks into your car. When you file your claim, there’s a good chance it’ll be denied.

4. Lying Can’t Fool Insurance Company Investigators.

Insurance companies work with experienced, well-trained investigators. It’s these professionals’ job to find out if there’s been any deception when you file a claim. If they do uncover something substantial, you risk being charged with insurance fraud.

5. Lying Can Increase Your Insurance Rates for a Long, Long Time.

Lying to your insurance company backfires with a vengeance. Instead of getting cheap auto insurance, your insurance rates go up immediately, and they’ll stay high for years.

In honor of National Honesty Day on April 30th, let’s all be a little more straightforward and transparent, especially when dealing with a list of insurance companies. At Freeway Insurance, we pride ourselves on our honesty and understanding in dealing with all of our customers. Request a free car insurance quote online or over the phone at (800) 777-5620 and see how much you can save on auto insurance.

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