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Guide To Insurance With Criminal Convictions
Getting insurance (UK) with criminal convictions can be difficult and expensive.
The ABI and UNLOCK have teamed up to produce guidance to make things fairer.
On the 21st February 2011, the ABI (Association of British Insurers) and UNLOCK (the National Association of Reformed Offenders) announced the launch of a guidance scheme to help improve the provision of insurance to people with criminal convictions.
Targeted at both consumers and insurers, this gives information to those buying and selling policies and will hopefully make the system fairer and easier to understand.
If you have a criminal conviction, then you might find it hard to get accepted for some types of insurance, or may be charged higher rates when you declare your circumstances. If you, for example, have a motoring conviction, then a car insurance company may opt not to give you a quote, may charge you a higher premium or may add exclusions to coverage because you pose a greater risk.
This can apply to you, people who live in your household or people named on policies. Not all insurers will ask about convictions during the application stages, however, and many people do not realise that they should disclose them. This can also lead to problems in the future, if the information then comes to light, and cover can be invalidated or cancelled.
From a consumer perspective, the ABI/UNLOCK guide is designed to make it easier for people to understand their obligations during the insurance application process. This often comes down to the status of a conviction. Under the Rehabilitation of Offenders Act 1974, unspent convictions come with a set period of rehabilitation before a record is wiped clean. Once this time is done, a conviction is considered to be spent.
You do not have to tell insurance companies about spent convictions, but, as the guide illustrates, you should tell them about unspent records, even if they do not ask. This is known as the 'duty of good faith'. A company may never find out that you didn't declare in full, but, if it does, you could see your policy avoided or cancelled and you may not be eligible to make a claim.
The guidance given in this report also asks for insurance companies to conform to a series of good practices. This could, for example, involve a provider making it more obvious how they deal with convictions and modifying application questions to make them clearer. It would also help if policies were more widely available for people with convictions and if insurers helped to find alternative policies if cover could not be given.
According to Nick Starling, the Director of General Insurance and Health at the ABI: Access to, and fair treatment by, financial services providers is a key part of financial inclusion. We recognise that some people with criminal convictions may encounter difficulties when looking for insurance. Our guidelines have been produced to ensure that people with criminal convictions get a fair deal when applying for insurance.
Despite calls for change, some insurance companies will not sell insurance to people with criminal convictions in any circumstances at the moment; others may take an individual's situation or offence into account. Those having problems finding a provider may find it useful to use the list of brokers produced by UNLOCK. Those with less problematic convictions but high premium costs could use an insurance supermarket to shop around for quotes.
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