Car insurance - higher premium to park in garage?

daveb975

I have just had my annual trawl through the car insurance websites. The quotes themselves are not too bad, but there is an anomoly with all of the quotes - garage parking is MORE expensive than on street.

For example, the cheapest quote is £530 if I park in my garage, £470 if I park on the drive and £460 if I park on the street outside.

I am sure parking in a garage used to attract a (pathetic) discount.

The only thing I can think of is that crime in my area is so low that the tiny risk associated with scraping the car whilst putting it in the garage is higher than the risk of theft! Given that I live on the edge of London, I hardly think this is going to be the case!

Even if they are being a bit stupid/paranoid that I am going to make claims for damage incurred in the garage, I still cannot understand why parking on my driveway is £10 more expensive than parking in a crowded, narrow road.

Does anyone have any ideas? I doubt this is an error as all of the main sites came up with the same answer.

noh

My guess is that nowadays because of increased security features most vehicle theft is effected by stealing the keys.
Cars parked on driveways or in garages indicate which house the keys are in.
If cars are parked on the street it is not obvious which house they are associated with therefore the car itself is less likely to be stolen.

This of course doesn't apply to vandalism or theft from vehicles.

warwick_hunt_2

There's also the claims from people scraping their cars when going in or out of the garage.
Plus pots of paint, ladders, bikes and other bits and bobs falling onto cars when in the garage.

Badger_Lady

I have heard of some very high value claims on cars in garages, purely due to value of the car being kept in the garage! Classic cars, top-end Mercs, Rollers... the thieves can work away at gaining access unseen by the public once they're in. And when you're in, there's generally a way to drive out.

InsideInsurance

Insurers, for existing business, work on the basis of statistics and not "theory". They regularly review how claims perform when you segment customers by only one question difference and amend ratings based on that. Any trying to workout "why" is really reserved for unusual risk or when moving into new areas where you have no existing data.

One of the most likely reasons is that with improved vehicle security it is almost impossible to take a car without the keys or lifting it onto the back of the lorry so the rate of thefts with keys are increasing. Therefore the risk of theft actually goes up when a thief can easily tie a car and set of keys together. Added to that you have risks of accidents getting in and out, risks of storm damage etc and added on top is of cause that a high proportion of people claim they use their garage when they actually park on their driveway. (I did analysis years ago and circa 35% of claims where the PH stated the car was in the garage overnight and they had had a theft from home motor claim didnt even have a garage)

mikey72

noh wrote: »

My guess is that nowadays because of increased security features most vehicle theft is effected by stealing the keys.
Cars parked on driveways or in garages indicate which house the keys are in.
If cars are parked on the street it is not obvious which house they are associated with therefore the car itself is less likely to be stolen.

This of course doesn't apply to vandalism or theft from vehicles.

Usually pressing the remote gives it away though.

mikey72

InsideInsurance wrote: »

Insurers, for existing business, work on the basis of statistics and not "theory". They regularly review how claims perform when you segment customers by only one question difference and amend ratings based on that. Any trying to workout "why" is really reserved for unusual risk or when moving into new areas where you have no existing data.

One of the most likely reasons is that with improved vehicle security it is almost impossible to take a car without the keys or lifting it onto the back of the lorry so the rate of thefts with keys are increasing. Therefore the risk of theft actually goes up when a thief can easily tie a car and set of keys together. Added to that you have risks of accidents getting in and out, risks of storm damage etc and added on top is of cause that a high proportion of people claim they use their garage when they actually park on their driveway. (I did analysis years ago and circa 35% of claims where the PH stated the car was in the garage overnight and they had had a theft from home motor claim didnt even have a garage)

So if you know they're not stolen out of a garage, why is it still given as the reason it's dearer?
35% of that reason must be untrue from what's you've said, so on road or on drive must actually have more claims, which is what the risk is assessed on.

olly300

mikey72 wrote: »

So if you know they're not stolen out of a garage, why is it still given as the reason it's dearer?
35% of that reason must be untrue from what's you've said, so on road or on drive must actually have more claims, which is what the risk is assessed on.

Remember postcode is used as well.

So if people in a postcode are more likely to claim for parking in their garages, real or fictious, then the premium will be more expensive.

I found this out a few years ago when I lived in a place where everyone had a garage or a drive they could park on, and used them to avoid having to pay for a parking permit. It was actually cheaper for me insurance wise to park on the road. I also didn't buy a permit as I calculated the few times I would be there a year when the zone operated buying visitors permits would be cheaper.

Also if you are going to steal a car you don't want people getting a full look at you this could be anyone from passerby to someone looking out of the window. So if you are trying to steal a car from the road and:
a. You pressed a remote trying to find what car it belonged to you would arouse suspicion,
b. You pressed a remote on an expensive car then people tend to look to see who is getting into.

InsideInsurance

mikey72 wrote: »

So if you know they're not stolen out of a garage, why is it still given as the reason it's dearer?
35% of that reason must be untrue from what's you've said, so on road or on drive must actually have more claims, which is what the risk is assessed on.

That is (one of) the reason the client in question stopped asking the question

Ultimately you are looking at trends and applying ratings based on that trend. Even if 90% of people who said they garaged their car every night didnt even have a garage if statistics showed that those that answered "garage" to the question had 3x the amount of theft claims from the home it would make statistical sense to load the premium.

In an ideal world it would be great to know the difference between what the policyholder says and what the truth is and you would then rate on both (the fact the customer is prone to lying would certainly be a rating factor and probably a high cause of declining cover) but as insurance is based on utmost good faith then pricing has to be done on whats said.

System

So the ultimate insurance questionaire would be one that asked a completely random set of questions with not even the pretence that honest answers were expected. Then a statistical pattern would emerge and premiums would be charged accordingly.

InsideInsurance

You could do a random set of questions but you would most likely find that many questions do not give any results of statistical relevance. You could find that some questions would be rough proxy for current standard questions but with a greater standard deviation.

Insurers have indeed played with asking other questions in the past (eg what colour car do you have) thinking there will be a correlation with driving styles (some would assume people with red sports cars are possibly more risky drivers than those with blue sports cars). Whilst this can be true you have to balance off trying to get the Technical Premium accurate -v- the scale of change in premium you're talking about -v- the commercial considerations (eg every call centre agent asking the colour and trying to match "shadow grey" or "Indigo Ink" against the 15 preset options )