Young driver insurance news
24/12/2010
Insurers condemn fronting
There has been a rise in the number of motorists committing the criminal practice of fronting, which involves a person with a good credit rating applying for finance for a new car in place of the actual buyer. This form of fronting is not to be confused with insurance fronting, a practice whereby, perhaps because of the prohibitive cost of young driver insurance, a young motorist is named as the secondary driver on the policy when he or she is in fact the main driver.
Just as with the growth in the number of young drivers insurance fronting, the Finance and Leasing Association (FLA) says that credit rating fronting has increased as a result of general economic pressures.
However, the FLA also says that fronting can sometimes be an organised crime.
The FLA's head of motor finance comments, "Motor finance companies are winning the fight against fraud through closer co-operation and partnerships with the police. Criminals are always finding new ways to beat the system, though.
"Fronted' finance agreements are on the rise, but lenders are determined to protect innocent motorists by developing new procedures to clamp down on offenders."
On a non-organised crime level, fronting is typically committed by people who have a poor credit score or cannot buy a car because of a young driver insurance offence, such as fraud.
Car insurers are known to widely condemn the practice.
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