insurance scam

recently i have learnt of this scam undertaken by insurance companies to bleed you drier.

a car hits yours while you are driving. the other driver takes all responsibility. they sort out their car through their insurance and any damage to your car too. you are lucky as yours is quite light. you may not even worry too much about making a claim. perhaps you even say to the other driver that aren't concerned with making a claim if it pushes up their insurance.

a couple of weeks go by and you get a call from some vehicle company who claim to act on the other driver's insurance company. they have your details so it seems legit. they say you can claim money! yay. you say no thanks. they seem shocked. they say, go for it, it's free money! you ask - can you confirm it won't increase the costs or the insurance premium of the other driver? they put you on hold.

they play terrible music.

they come back to you and say, yes, that is correct. you ask for that in writing.
you have to send them an email and in it, you request again, for confirmation in writing that it won't affect the value of the claim to the other driver or their premiums.
a few weeks later you get a cheque for a couple of hundred pounds. you never got a reply in writing.

a few more weeks, perhaps months go by and you renew your car insurance. all the other quotes are much higher than your renewal with your same company so you stick with who you've got.

a few more weeks go by and they email you to tell you that you lied when filling out your form and are gonna add 50% to the premium. you call them, and they say it's because you didn't mention the claim.
well, you did. and they check their phone records, confirm this, and waive the fee.

it turns out, they should have charged that amount, it's just the person on the phone renewing it made a whoopsie.

this got me thinking. you get hit by another car, so your insurance premiums go up?? apparently, people that get claims for being hit, then go on to make claims against their own insurance more often, so the premium goes up.

i want to know how it's possible for a third party company to be so pushy in getting you to claim a small amount of money, knowing that the insurance premiums for at least one if not both parties will increase, and not be up front about it when questioned.
i want to know if the insurance companies are behind this attitude to encourage people to claim, knowing this means that they can get more in the long run.
i want to know what happens if you don't take any money for a claim when you get hit. if you still mention it, do you still get a premium increase?
i want to know if this is common knowledge? do people know that if they get hit, everything goes through the other party's insurance, their own insurance premium will go up?

so many questions. i may have to write to watchdog.