According to figures just released by the Association of British Insurers (ABI), last year insurers uncovered 133,000 fraudulent insurance claims. That’s an average of 2,500 every week (up 9% on 2009).
The value of these claims was GB pound 919 million, also up 9% on the previous year.
Across the last five years, both the number and overall value of insurance frauds detected have risen by over 100%. The most common frauds involved home insurance (with 66,000 bogus or exaggerated claims detected), followed by dishonest motor insurance frauds (with 40,000 frauds uncovered).
Motor frauds were the most costly, totalling GB pound 466 million.
The value of savings from detected frauds represented 5% of all claims when compared with 4% in 2009
Cheats uncovered by insurers
A claim for back injuries apparently sustained from a fall while working in a nightclub was rejected when Facebook images showed the claimant performing gymnastics and training for a charity run.
One woman’s claim for facial injuries she said resulted from a falling toilet roll holder in a fast food outlet was rejected when it was shown that the holder would have had to have fallen upwards to cause the injury claimed.
A man claimed for a ‘lost’ engagement ring. His ex-partner said that she was never given a ring as they had never been engaged. On the same day the man said he had suddenly found the ring.
One claim by a woman for the loss of a GB pound 2,000 watch after a night out was rejected when the photograph she provided of herself allegedly wearing the watch turned out to be that of a friend.
A claim for an injury said to have been caused by an individual falling over a wall was rejected when it was proven that there was no wall at the scene of the alleged incident.
It’s estimated that insurance fraud costs GB pound 2 billion a year. On average, this adds an extra GB pound 44 each year to the insurance bill for every UK policyholder.
Protecting honest customers against fraud
Speaking about the latest statistics, Nick Starling – the ABI’s director of general insurance and health, said: “Insurers are working harder than ever to protect honest customers against fraud. The savings made by weeding out fraudulent claims would otherwise end up being paid for by honest policyholders through higher premiums.”
Starling continued: “Fraudsters continually look for new ways in which to con insurers, so we’re upping our game. Early next year we will be setting up a national Insurance Fraud Register, which will contain details of all known insurance cheats.”
In conclusion, Starling told SMT Online: “At the same time, the first ever national police insurance fraud investigation unit will begin its operations, making it harder than ever to commit insurance fraud.”
Glen Marr, director of the Insurance Fraud Bureau, also offered his views on the latest ABI missive.
“Fraudsters will increasingly find the insurance industry a hostile environment. The IFB is committed to supporting insurer efforts to systematically root out and tackle fraudsters.”
Report fraudsters via the confidential Cheatline
The IFB has access to a significant volume of industry data, uses sophisticated and powerful analytical software, works in partnership with insurers, law enforcement agents and regulators and, according to Marr, has “no shortage of reports” being received from consumers of their knowledge or suspicions of those concerned with defrauding the industry. These reports are received via the Cheatline facility.
“We would urge anyone with information on any type of insurance fraud to support industry efforts to root out the fraudsters,” said Marr. “They can do so by calling the IFB free and confidential Cheatline on 0800 3282550 or by using our online reporting facility” (see the foot of this page for a dedicated web link)
Reports to Cheatline can be completely anonymous if necessary.
“It’s important to underline the fact that some of those concerned with insurance fraud are also involved in criminal activities where there is harm done to local communities”.
