Insurers Crack Down on £1Billion a year Fraudsters

Insurance fraudsters are costing honest householders and drivers £50 a year extra on their policies with crooked claims, according to the Association of British Insurers (ABI).

Investigators uncover around 2,670 false claims valued at £19 million every week, says the ABI. Last year, fraudsters tried to con money out of insurers with 139,000 bogus claims for £983 million.

Home insurance frauds were the most common with 71,000 claims valued at £106 million, while false motor insurance claims were the most expensive, with 45,000 claims for £541 million detected – mainly involving compensation for whiplash injuries.

In one case, 30 men who hired a coach to take them greyhound racing all fraudulently claimed for whiplash compensation following a staged accident with the car.

Now insurers are cracking down on fraudsters with a register of known fraudsters.

Richard Davies from the ABI Financial Crime Committee, said: “The Insurance Fraud Register underlines the industry’s continuing commitment to reducing fraud and protecting honest customers. It complements the work of the Insurance Fraud Bureau in detecting fraud, and the Insurance Fraud Enforcement Department in prosecuting fraudsters.

“The register will make it easier for insurers to prevent fraud by making details of known fraudsters available to insurers. It gives the clearest signal yet that we are more determined than ever to clamp down on insurance fraud. Those that defraud insurers and their honest customers face real and tangible consequences for their actions.”

Other frauds detected last year include:

  • A family jailed for 15 months each after making more than 100 false claims for damage to their property that usually involved alleged storm damage to roofs and damage to walls caused in hit-and-run accidents
  • Police uncovered a staged motor accident gang that it was believed were involved in 180 accidents linked to 230 insurance claims, worth £3.2 million.
  • A man who cut his thumb in a gym made a claim for a more serious injury using a photograph he downloaded from the internet.

Otto Thoresen, ABI’s Director General, said: “The industry makes no apologies for its zero tolerance approach to insurance fraud. Honest customers are sick of footing the bill for insurance cheats, through higher insurance premiums.”

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