Penalty For Reporting Less Miles Than You Actually Drive

[Prouddad]

I'm considering going on my fiance's auto insurance policy. We live in California. Her agent has suggested that I can save premium dollars by under-reporting the amount of miles that I drive each year. I've always reported my miles driven accurately.

In addition to the moral question here, is there a legal or coverage-related problem if I under-report my miles driven when I complete an application?

 

[Josh]

It sounds to me like your agent is suggesting you lie about a material fact to save a few bucks. I'm not sure what the penalty is, but that's certainly lying on an insurance application and I would strongly advise against it. You may also want to consider finding a new agent.

 

[BlockO]

prouddad,

There are no legal consequences in lying about mileage on an insurance app. It is known as soft fraud, which is basically lying, but not bad enough to rise to the level that would cause you to be charged with a crime.

And the truth is, you will most likely get away with it.

But the problem comes when it's time to file a claim! The claims adjuster is going to see that you are getting a low mileage discount and ask: "Mr. Prouddad, can you show us a copy of your last year's tax return that indicates how many miles you reported driving in that vehicle?".

Moral issue aside, I don't think it's worth the risk of having a claim problem just for saving a few bucks. I would certainly discourage a potential customer from doing it for that same reason. A simple tax document is all it takes to be proven wrong.

 

[BigIVU]

In most states, insurance fraud is a felony. Maybe you and the agent can be cell mates.

 

[USF3983]

The savings is probably minimal.

You can be denied coverage for material misrepresentation is my guess.

 

[xrac]

Lying about the mileage is not going to result in a problem unless the insurance company picks up on it and raises your rates or tries to back charge but I might not want to fully trust this agent.

 

[Igozoom]

I don't think that the agent is giving you an ethical advice. You must consult another agent.

Any agent advising a customer to do something like this is definitely unethical and I would second the advice to find a new agent! If you drive more, you are a greater risk and it's only fair that your premium reflect that. Shop around and you probably will find equal or greater savings than you would by underreporting your mileage!

 

[Stephen]

As a Razorback fan, I was hoping that someone was going to report Les Miles for a recruiting violation.

 

[ChoiceplusIS]

I'm considering going on my fiance's auto insurance policy. We live in California. Her agent has suggested that I can save premium dollars by under-reporting the amount of miles that I drive each year. I've always reported my miles driven accurately.

In addition to the moral question here, is there a legal or coverage-related problem if I under-report my miles driven when I complete an application?

If you are doing business with an agent that is recommending you to commit insurance fraud, you should reconsider. As an Insurance agent in California, Auto Insurance rates are based on your annual mileage and other factors. If you low ball your mileage, thus creating insurance fraud and an accident occurs you may not have insurance at all. If you are looking for more information and ethical insurance agents in California, this is a good start Choice Plus Insurance.

 

[callcreatorplus]

I've seen premiums get a lot of savings from lowering the annual mileage, but you should never lie on an application. Insurance companies are NOT your friend. They'll look for any reason to not have to pay out when there's a claim. And guess what happens to that agent when you get caught lying on your app? Nothing. He probably won't even be notified. Bottom line, don't lie for your own sake.