Covea Car Insurance - Unauthorised Hard Credit Search

Velar19

Hello all,
I was wondering if anyone else has had this - I took out a car insurance policy through John Lewis Finance (Covea Insurance) at the start of November, with the policy starting on 14th November.  However, I have received an alert from Credit Karma this morning, informing me that Covea Insurance have carried out a hard search on me TODAY, 30th November.  I have called Covea, and ended up speaking to someone in the underwriting team, who had absolutely no idea why this has been done, as all that should of been done was a soft search, at the time of application.  He is going to "look into it" and get back to me, but I am very annoyed that a hard search has been done without my knowledge or authorisation. Any help or advice would be very much appreciated.

DullGreyGuy

Are you paying by installments (ie having a loan) or paid in full up front?

Searches are not just hard/soft but they give a reason for the search... assuming you went paying by installments it almost certainly says ID check or Insurance Application (or something to that effect). No lender is going to give two hoots that you are applying for insurance even if its a hard search. Advice on here is always over simplistic, its hard searches as a Credit Application/ Quote that you need to be worried about if you are planning to do a mortgage application or such. 

Velar19

@DullGreyGuy I am paying by monthly instalments. I fully understand what you are saying. However, the point is, is that only a "soft" search should of been done, and this should of been done at the point of application. I applied at the start of November, and took out the policy, that started on 14th November.  So the fact they have done a hard search on 30th November makes no sense.  The purpose of the hard search was given as "Checking credit application" so it is an issue as far as I am concerned. I am not applying for a mortgage or anything else, but I am extremely annoyed that this will affect my score when it should not have happened in the first place.

Ebe_Scrooge

Velar19 said:

I am paying by monthly instalments...

only a "soft" search should of been done...

The purpose of the hard search was given as "Checking credit application" so it is an issue as far as I am concerned. I am not applying for a mortgage or anything else,

If you pay by instalments then they are giving you credit.  They're effectively giving you a loan for 1 year to pay for the insurance policy (which is why paying by instalments is always more expensive than paying outright).  So a hard search is perfectly correct - you were applying for credit.

As to the delay - I'm wondering whether it's just a delay in Credit Karma notifying you?  The free reports you see are not usually real-time, and often have a couple of weeks delay before the data is updated.  Can you check your report to see the date when the search was actually performed (not when you were notified).

Oh, and ignore your score, it means diddly-squat.  And a search, even a hard search, is no cause for concern in itself.  Dozens of searches in a short space of time starts to look suspicious, but one search is neither here nor there.

Velar19

Ebe_Scrooge said:

Velar19 said:

I am paying by monthly instalments...

only a "soft" search should of been done...

The purpose of the hard search was given as "Checking credit application" so it is an issue as far as I am concerned. I am not applying for a mortgage or anything else,

If you pay by instalments then they are giving you credit.  They're effectively giving you a loan for 1 year to pay for the insurance policy (which is why paying by instalments is always more expensive than paying outright).  So a hard search is perfectly correct - you were applying for credit.

As to the delay - I'm wondering whether it's just a delay in Credit Karma notifying you?  The free reports you see are not usually real-time, and often have a couple of weeks delay before the data is updated.  Can you check your report to see the date when the search was actually performed (not when you were notified).

Oh, and ignore your score, it means diddly-squat.  And a search, even a hard search, is no cause for concern in itself.  Dozens of searches in a short space of time starts to look suspicious, but one search is neither here nor there.

The search was actually conducted today, 30th November.
Covea themselves have said that they do not do hard searches, they only do soft ones when paying by instalments, so he is also confused as to why they have done this!!  I appreciate what you are saying about my score not meaning much, and not being affected by one search. I'm just annoyed that they have done it in the first place, and the timing of it that is strange. I will hopefully get some feedback from Covea on why this has happened.

DullGreyGuy

Velar19 said:

Ebe_Scrooge said:

Velar19 said:

I am paying by monthly instalments...

only a "soft" search should of been done...

The purpose of the hard search was given as "Checking credit application" so it is an issue as far as I am concerned. I am not applying for a mortgage or anything else,

If you pay by instalments then they are giving you credit.  They're effectively giving you a loan for 1 year to pay for the insurance policy (which is why paying by instalments is always more expensive than paying outright).  So a hard search is perfectly correct - you were applying for credit.

As to the delay - I'm wondering whether it's just a delay in Credit Karma notifying you?  The free reports you see are not usually real-time, and often have a couple of weeks delay before the data is updated.  Can you check your report to see the date when the search was actually performed (not when you were notified).

Oh, and ignore your score, it means diddly-squat.  And a search, even a hard search, is no cause for concern in itself.  Dozens of searches in a short space of time starts to look suspicious, but one search is neither here nor there.

The search was actually conducted today, 30th November.
Covea themselves have said that they do not do hard searches, they only do soft ones when paying by instalments, so he is also confused as to why they have done this!!  I appreciate what you are saying about my score not meaning much, and not being affected by one search. I'm just annoyed that they have done it in the first place, and the timing of it that is strange. I will hopefully get some feedback from Covea on why this has happened.

What does it say the purpose of the search was on the CRA? 


Insurers are relative lax with these things, with a bank they want to know you are good up front else you could take the money and run. With an insurer if you dont pay they can ultimately just cancel or void the policy which means there losses are relatively small. 

Certainly a (long) while back most direct insurers weren't compliant with the Consumer Credit Act, again too much effort for the small losses they sustain. 

Most counter fraud checks are performed post purchase, for a variety of reasons, and again credit checks can be part of that process to ensure there are no CIFAS markers 

If the reason for the search is listed as Insurance Application or something similar no lender is going to give it any more thought. 

Migster

I'm wondering if the delay is due to the 14-day cooling-off period i.e. they wait until this is up before they formalise the loan/credit.

Velar19

DullGreyGuy said:

Velar19 said:

Ebe_Scrooge said:

Velar19 said:

I am paying by monthly instalments...

only a "soft" search should of been done...

The purpose of the hard search was given as "Checking credit application" so it is an issue as far as I am concerned. I am not applying for a mortgage or anything else,

If you pay by instalments then they are giving you credit.  They're effectively giving you a loan for 1 year to pay for the insurance policy (which is why paying by instalments is always more expensive than paying outright).  So a hard search is perfectly correct - you were applying for credit.

As to the delay - I'm wondering whether it's just a delay in Credit Karma notifying you?  The free reports you see are not usually real-time, and often have a couple of weeks delay before the data is updated.  Can you check your report to see the date when the search was actually performed (not when you were notified).

Oh, and ignore your score, it means diddly-squat.  And a search, even a hard search, is no cause for concern in itself.  Dozens of searches in a short space of time starts to look suspicious, but one search is neither here nor there.

The search was actually conducted today, 30th November.
Covea themselves have said that they do not do hard searches, they only do soft ones when paying by instalments, so he is also confused as to why they have done this!!  I appreciate what you are saying about my score not meaning much, and not being affected by one search. I'm just annoyed that they have done it in the first place, and the timing of it that is strange. I will hopefully get some feedback from Covea on why this has happened.

What does it say the purpose of the search was on the CRA? 


Insurers are relative lax with these things, with a bank they want to know you are good up front else you could take the money and run. With an insurer if you dont pay they can ultimately just cancel or void the policy which means there losses are relatively small. 

Certainly a (long) while back most direct insurers weren't compliant with the Consumer Credit Act, again too much effort for the small losses they sustain. 

Most counter fraud checks are performed post purchase, for a variety of reasons, and again credit checks can be part of that process to ensure there are no CIFAS markers 

If the reason for the search is listed as Insurance Application or something similar no lender is going to give it any more thought. 

Checking credit application was the reason quoted for the hard search.

mab3000

https://www.coveainsurance.co.uk/brokers/broker-news/credit-check-changes/

This article suggests that a recent change has been made in regards to credit checks for customers paying their premiums monthly, driven by the FCA. 

It’s possible that the member of staff you spoke to hasn’t been made fully aware of the changes. It happens. 

It also states on their privacy policy that;

We will perform credit and identity checks on you with one or more credit reference agencies (CRAs) in the following circumstances:

• When you apply for an insurance quote with us;
• Prior to renewals on all existing policyholders;
• When you apply for credit from us.

When CRAs receive a search from us they will place a search footprint on your credit file that may be seen by other lenders.

Velar19

mab3000 said:

https://www.coveainsurance.co.uk/brokers/broker-news/credit-check-changes/

This article suggests that a recent change has been made in regards to credit checks for customers paying their premiums monthly, driven by the FCA. 

It’s possible that the member of staff you spoke to hasn’t been made fully aware of the changes. It happens. 

It also states on their privacy policy that;

We will perform credit and identity checks on you with one or more credit reference agencies (CRAs) in the following circumstances:

• When you apply for an insurance quote with us;
• Prior to renewals on all existing policyholders;
• When you apply for credit from us.

When CRAs receive a search from us they will place a search footprint on your credit file that may be seen by other lenders.

Thank you for this. I am still waiting to hear from Covea about this matter. It is almost impossible to get to the right person to speak about it, and I am continually being passed from person to person. No-one seems to know how to deal with my query!!

k3lvc

Velar19 said:

mab3000 said:

https://www.coveainsurance.co.uk/brokers/broker-news/credit-check-changes/

This article suggests that a recent change has been made in regards to credit checks for customers paying their premiums monthly, driven by the FCA. 

It’s possible that the member of staff you spoke to hasn’t been made fully aware of the changes. It happens. 

It also states on their privacy policy that;

We will perform credit and identity checks on you with one or more credit reference agencies (CRAs) in the following circumstances:

• When you apply for an insurance quote with us;
• Prior to renewals on all existing policyholders;
• When you apply for credit from us.

When CRAs receive a search from us they will place a search footprint on your credit file that may be seen by other lenders.

Thank you for this. I am still waiting to hear from Covea about this matter. It is almost impossible to get to the right person to speak about it, and I am continually being passed from person to person. No-one seems to know how to deal with my query!!

Probably because they've complied with their policy and have nothing to add to any discussion with you. You're paying monthly, you've taken out a credit agreement and they've checked (as they said they would). 

If it was a genuine issue/risk to you then paying in a lump sum was the way forward