allegations of racism by insurance company

JonBoy_SCFC

my mate is from Asian background, and has recently tried setting up a car insurnance policy for his BMW. he got a price online but when he called the company to complete the deal they went checked all his details

turns out he had put himself as a uk resident from birth, when in fact he moved here at 11 years of age (he is now 32). changing this caused his price to increase by £130 and he is complaining about racial discrimination. he is threatening to complain to racial discrimination board, FSA/FOS and to the press

i have told him it's likely to be that foreigners are more likely to have accidents, but he is furious and insists it is just a racist policy to charge more (he has never had an accident and driving in this country 10+ years)

the insurance company are saying that it's not racist because they charge this to all races that are born outside UK, not just Asians

my question is: does he have any chance getting anywhere with his complaint in either FSA/FOS or in the press?

i will be showing him this website so any comments appreciated:beer:

Oscar_The_Grouch

This is a difficult one and I think that it will be interesting to find out what the FOS think of it.

Insurers are allowed to "differentiate their prices" when they are able to show that there is justification for it - hence the fact that young drivers pay more and women are charged less for their car insurance until you get to about 45, when it all evens out (and after 50, the men get the best prices).

So do the insurers really have enough evidence to say that if you were not born in the UK, you are more likely to have an accident?

I for one don't think so and that the FOS will force the insurer to reduce their premium.

VfM4meplse

The price hike might have something to do with supplying inconsistent details, is there a question mark over your friends relationship with the truth? Car insurers pool details, this is in the small print / verbally delivered at the stage of the quote.

I don't think a complaint will get anywhere with the FSA if the word of the person submitting the complaint is considered to be unreliable.

Oscar_The_Grouch

VfM4meplse wrote: »

The price hike might have something to do with supplying inconsistent details.

Not sure I agree with you; upping the price "because I think you lied" will not stand up with the FOS.

VfM4meplse

Oscar_The_Grouch wrote: »

Not sure I agree with you; upping the price "because I think you lied" will not stand up with the FOS.

But failure to disclose may legitimately increase an individual's risk-rating?

tsstss7

Personally I think this is racist. If there is any justification for such a policy it would have to be based upon actual observed increased risk presented by drivers from other countries (which is be likely due to different driving conditions abroad) but presumably as this man has been in the uk since age 11 he will have taken all his driving lessons etc in the UK and derive most if not all attitudes towards risk and general driving standards from his experience of living in the UK.

I'd be inclined to believe that insurers have lumped all non uk born citizens in one big higher risk category while failing to notice that some will likely be more risky to insure than others.

Ant85

tsstss7 wrote: »

Personally I think this is racist. If there is any justification for such a policy it would have to be based upon actual observed increased risk presented by drivers from other countries (which is be likely due to different driving conditions abroad) but presumably as this man has been in the uk since age 11 he will have taken all his driving lessons etc in the UK and derive most if not all attitudes towards risk and general driving standards from his experience of living in the UK.

I'd be inclined to believe that insurers have lumped all non uk born citizens in one big higher risk category while failing to notice that some will unlikely be more risky to insure than others.

But that's how insurance works, insurers have to use indicators as to a persons risk.

In the same way that young drivers are all lumped together despite some of them been good drivers people who have moved here from other countries are lumped together as it's impossible to examine each individual separately.

It's not racist in the slightest as it's not done on ethnicity

dunstonh

Its not racism. The question as asked is to find out the start date of UK residency and premiums are often raised for those with a high proportion of their life for being a non-resident.

The country of origin is not the issue. The proportion of life as a resident is. Hence, no racism.

The FOS have no juridstiction in cases of commerical pricing decisions providing there is no discrimination. There is no discrimination or racism here. So, a complaint to the FOS would not be upheld.

MarkyMarkD

Oscar_The_Grouch wrote: »

Not sure I agree with you; upping the price "because I think you lied" will not stand up with the FOS.

I would agree if that was the situation. But the situation here is that the OP's "friend" did lie on his insurance proposal form.

It's very unusual for them to go back and check details on the phone, unless they had a reason to doubt the veracity of the details. Most online applications are just accepted. It implies that they have identified anomalies in the data against other records - possibly even previous year's quote applications to the same company - and that is why they called.

It's not a hard question to get right either. "Have you lived in the UK all of your life?" No. (in his case).

Most online application processes also show you all of your answers at the end, so you have a second chance to check if you've made an "innocent mistake".

jonesMUFCforever

Would this be called racism if it was a white person who's premium had been upped after some information had been found inconsistent??

1.9.8.1

I work in insurance, the majority of policies we sell are through online now. The amount of proposal forms / statements of facts we recieve from male customers who set up the policy online with their sex as female, then amend the sex to male on the paperwork, Probably averages about 5 to 10%. of course we amend this and there is an increase in premium. Of course they always complain, even though they blatantly lied to get cheaper premiums and expect to get away with it.

This is not sexist as it is a known fact that Males are typically a higher risk than Females so attract a higher premium.

Also married people attract a slightly cheaper premium as they are seen to drive more carefully as they 'have more to loose'. This is not 'singleist' as this is based on facts of stats generated over years.

Insurance is based on statistics, so premiums reflect these, hence the reason the length of residency question is asked.