MyLicence: driver database will cut some car insurance premiums

The end of car insurance lies

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The MyLicence driver database means drivers won't be able to lie when applying for car insurance

The MyLicence driver database means drivers won't be able to lie when applying for car insurance.

Insurers are confident that MyLicence, a Big Brother-style insurance database, due to go live in the next few weeks, will put an end to motor insurance companies relying on drivers telling the truth about their driving history.

MyLicence will only be available to insurers, not the general public, and will confirm whether a driver has been convicted of any driving offences.

Checking the database will negate the need for brokers and insurers to ask potential customers to list certain details including penalty points.

Industry experts say the new database will knock £15 off the average car insurance premium for some drivers and speed up the application process. But will it?

What is MyLicence?

The database is called MyLicence and has been under construction for three years. Initially known as Insurance Industry Access to Driver Data, it's a joint project between the Driver and Vehicle
Licensing Agency (DVLA), the Motor Insurers' Bureau (MIB), the Association of British Insurers (ABI), and the Department for Transport.

The ABI says that after the database goes live people searching for car insurance quotes may be asked to provide their Driving Licence Number (DLN).

The DLN will be used to get information from the DVLA about the driver. This will include the type of licence held, how long they have held it, and any driving convictions. However, the ABI points out that it's voluntary - we all have to give consent for our records to be checked.

It should mean you can no longer lie or make mistakes about your driving history. The ABI reckons that 23% of data provided to motor insurers is incorrect, with 16% of policyholders under-declaring convictions, and about 7% over-declaring.

Currently, insurers can check individual driving records through the DVLA, but this is expensive and time-consuming.

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What does MyLicence mean for your insurance?

The idea behind MyLicence is to ensure that risk is priced accurately and to speed up the quotation process.

The ABI says some drivers will save an average of £15 under the new system as they will no longer own up to spent penalty points and convictions by mistake.

Dishonest drivers, meanwhile, who have been lying about their driving history when obtaining insurance in the past, will pay more. It's worth pointing out that lying about your driving history when applying for insurance counts as fraud and can invalidate your car insurance.

Basically the effect of MyLicence on insurance costs will come down to whether you've been telling your insurer the truth so far. However it relies upon insurers and comparison sites signing up to the new system – not all of them have done so far.

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Can I check the information held on me?

Drivers themselves will not have access to the MyLicence system – it's for insurers and brokers only.

However, the DVLA is developing a separate online database called View Driver Record for consumers to check that their details are correct. It's due to launch next month.

What effect do points have on premiums?

How much you pay for car insurance depends on a number of factors including your age, where you live, the car you drive, your driving history (including accidents), and your job. So, how many points you have is just one influence on the premium you're quoted.

Points for speeding or other offences will mean you're a higher risk and you'll pay more for insurance.
If you've been convicted of drink driving or been disqualified for a period of time, you can expect a much bigger price hike than if you just got three points for speeding.

How long points will remain on your licence depends upon the driving conviction that you've been charged with.

In most cases this will be four years from the date of the offence or the date of conviction. However if you're convicted of a more serious offence such as drink or drug driving or causing death by dangerous driving then the endorsement will be on your licence for 11 years.

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