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New scam detected every minute as UK insurance fraud rises to £1.3 billion

Published 22 August 2018

Over half a million insurance frauds were detected in 2017, with a new case being detected every minute according to the latest figures from the Association of British Insurers.

A total of 562,000 scams were detected in 2017: 113,000 were for fraudulent claims, while 449,000 were for dishonest applications. Motor insurance made up the bulk of misleading applications, with drivers typically lying about their occupation, claims history and motoring convictions.

The overall number of fraudulent motor insurance claims rose by four per cent in 2017, with 67,000 cases being recorded at a value of £775 million. However, the number of large organised frauds, such as staged motor accidents by gangs, fell by 22 per cent. There was also a drop in the overall number of insurance crime in the UK, although the total value of these crimes rose slightly to achieve a new high of £1.3 billion.

The Insurance Fraud Bureau and the Insurance Fraud Enforcement Department are tasked with investigating dishonest claims. Notable cases in 2017 included that of a cyclist who claimed £135,000 compensation from a council for injuries sustained when he fell off his bike after hitting a pothole; after an investigation it emerged that he had actually fallen on a slippery road at another location. He was jailed for three-and-a-half years.

Accident - Car Park

The ring leader of a gang who staged a bus crash to try to get £500,000 in insurance pay-outs for fake injuries was jailed and banned from driving for two years. Using a rental car, he staged the crash, following which eight of his fellow fraudsters on the bus claimed for fake injuries to necks and hips.

A man was also jailed for three years and eight months for selling fake motor insurance policies to unsuspecting motorists.

Ben Fletcher, director of the IFB, said: “These numbers go to show the complexity of the task that insurers and the industry have in fighting insurance fraud. We has seen a rise in the number of live investigations, as well as a more diverse range of fraudulent behaviours, as these criminals move to target new areas.

"Fraudsters are tenacious and regularly change their methods, moving between products, sectors and approaches. They will exploit any area they are able, and the industry faces a constant battle to stay one step ahead."

Comments

Colin Shirley    on 28 August 2018

Its an eye opener and we are all paying for it "honest legal drivers that is" but its little wonder they get away with it due to the lack of law enforcement on the roads.I can never understand when i take out car insurance with a different company the renewal is not competitive and I go else where,surely it would be more beneficial to keep known drivers and offer favorable premiums.I have been insured by the same insurer for three years now but only haggling the renewal premium.

peter corrins    on 28 August 2018

hi all, had an email from my insurance comp axa to say they will invalidate my insurance because they did a check and found that a claim was made last year involving my car , i didnt have any accidents with me and my car but at work the car was dinged by their fork lift and they took to do with it all and it was sorted by them , but axa are wanting me to change my details regarding this and then want to charge me £20 for doing the change, buy why should i have to pay this if i took nothing to do with the claim and i had forgot all about it as it was not a lot of damage just needed a buff up but just another extortion from insurance companies to get more money out of you , but do i have to pay this as if i dont they will cancel my policy charge me more to cancel it and then i will have to look for another policy so can someone help with , cheers.

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