From professional indemnity insurance to mobile phone insurance, there are people trying to cheat the system. It has been unveiled that in 2010, there were 133,000 insurance claims that turned out to be fraudulent, which work out to be about 2,500 claims every week that were fake, and according to the Association of British Insurers, this was an increase of 9% from the previous year. Since 2005, the increase has been an incredible 100% from the fraudulent insurance claims that had been detected.
These fake claims are estimated to cost the insurance industry £2bn every year. This does not please UK policyholders as on average, £44 is added per year to every insurance bill. Due to this huge extra cost, a register has been designed to contain the details of any people who have already been deemed to have cheated the system.
Home insurance scams topped the list as the most common bogus claim with a staggering 66,000 recorded frauds, with motor insurance coming in second place with 40,000 fake claims. Just the motor insurance alone has cost £466m to the UK public.
The Association on British Insurers (ABI) has given us details as to how some of the insurance scammers were caught. One person was caught after claiming to have fallen whilst working in a nightclub, only to be found via Facebook to be training for a charity run.
Another claim came from a woman who was said to have been hit in the face by a toilet roll holder from a fast food chain. This was later dismissed due to the fact that the toilet roll holder would have had to have ‘fallen upwards’ in order to have hit her. As strange as these claims may seem, they are all true, including a person claiming for falling over a wall. However, when the insurers came to the scene of the accident, there was no wall to be seen.
The general insurance and health director of the ABI, Nick Starling, has said that they are continually “upping their game” as the fraudsters are coming up with new ideas to fake their insurance claims. He says the register will be set up at the start of next year which will contain all details for any insurance cheats that have records of. This will coincide with the national police insurance fraud investigation unit beginning its operations, aiming to make it as difficult as possible to make a fraudulent claim.
From the Insurance Fraud Bureau (IFB), the director Glen Marr has asked the public to help as much as possible to report anyone they believed to be committing a fraudulent offence by using Cheatline.
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