What is car insurance “fronting”?

Some car insurance clients neglect to make full disclosure to their insurance providers, whilst others take this even further through “fronting”. Not everyone understands what fronting is – A UK survey has revealed that many vehicle owners are confused about fronting, with 57 per cent unaware that it is illegal – 26 per cent think that it is, while 31 per cent say they do not know one way or the other.

We would like to discuss “fronting” in a bit more detail, explain what it is and why it is such a dangerous and illegal practise.

What is “fronting”?

Vehicle owners regard fronting as a method to get a better deal on their car insurance. Parents with children who drive are the biggest culprits for fronting, and do so in an attempt to cut the cost of young drivers’ car insurance.

This is also used by young and new drivers confronted with expensive car insurance premiums. By allowing an experienced driver to become the main driver on their insurance policy, they find that they pay significantly lower car insurance premiums.

Why is fronting illegal?

Fronting amounts to car insurance fraud as it amounts to a fraudulent disclose of the facts to the car insurer. You are presenting a much higher risk for the insurers than what they have quoted you for. To the insurer the main/ regular driver should be the one using the car most of the time and any additional drivers should be driving occasionally.

An experienced driver is less likely to be involved in an accident than a young driver and will be entitled to cheaper car insurance premiums. If the young driver uses the car more than the main driver, it will be called fronting in car insurance terms. It amounts to giving false information when getting car insurance quotes and is regarded as car insurance fraud.

Difference between fronting and incomplete disclosure

There is an important difference between mere neglect to disclose correctly on the one side – and fronting on the other. Where the vehicle owners allows another person to drive the car regularly without disclosing the facts – there might be no insurance premium saving. I have earlier this week added an addendum to my car insurance policy – a friend is experiencing financial difficulty and will be driving my old 1986 bakkie for a few months. He is of the same age as myself and will be driving in the same area etc. There is no change in the car insurance premium and all that is required is an addendum to add another driver as regular driver.
When vehicle owners are fronting the fault on their part is to be found in the “intention” when they purchase the car insurance policy. They KNOW that the facts disclosed on the policy are incorrect and the INTENTION to BENEFIT from paying a cheaper car insurance premium and then submitting a claim for the damage in the event of vehicle loss or damage will result in car insurance fraud.

In both these cases the car insurance company may dismiss the insurance claim – but in the event of fronting may also charge the client who submits the claim with insurance fraud!

Car insurance companies will investigate all suspicious claims and may question neighbours, friends and colleagues to find who has been driving the vehicle the most. It is simply a risk not worth taking!

Consequences of fronting

Fronting is extremely risky to both the vehicle owner and the young driver. We would like to share a few of the consequences to consider:

Fronting is more than a harmless white lie – it is actually car insurance fraud!
The policyholder may be charged and prosecuted with the crime of insurance fraud.
Committing insurance fraud will invalidate your car insurance policy.
In countries where the law requires car insurance, the young driver may be charged with driving without valid insurance.
Having invalidated the car insurance policy car insurers may look to reclaim third party damages if drivers on a fronting policy are involved in an accident.
Fronting will be bad on your insurance record [insurance database], making it difficult to get insurance in the future, or considerably push up the cost of premiums.
Fronting could delay the young driver from building up his own no claims bonus.

Advice to vehicle owners

We would like to urge vehicle owners to review their car insurance policies from time to time. Check the facts and whether they are still as true as disclosed at the time of purchasing the car insurance policy. These facts fall in the domain of the vehicle owner and can only be disclosed by him. We cannot blame the insurer for dismissing a claim when the accident claim and driver details are not constant with the disclosures made!

Make a full disclosure to the car insurer – you do not want to lie on your accident claim. Rather consider other ways to find cheaper and affordable car insurance premiums. Your integrity is worth so much more!!

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