Insurance Fraud Reaches Record High

The value of fraudulent insurance claims uncovered by insurers rose to a record £1.3 billion in 2013, up 18% on the previous year according to figures published today by the Association of British Insurers (ABI).

This figure is more than double the cost the UK's shoplifting bill.

The ABI's latest figures on insurance frauds uncovered in 2013 show that:

• Insurers detected a total of 118,500 bogus or exaggerated insurance claims, equivalent to 2,279 a week. The average fraud detected across all types of insurance products was £10,813. While there was a small fall in the number of detected frauds their value, at £1.3 billion, was up 18% on 2012.

• Fraudulent motor insurance claims were the most expensive and common, with the number of dishonest claims at 59,900 claims up 34% on 2012 and their value at £811 million up 32%.

• The number and value of property insurance frauds fell on 2012: 35,000 frauds worth £137 million. These figures represent falls of 38% and 24% respectively on 2012.

• Since 2007 the value of dishonest general insurance claims detected has more than doubled, with the number detected up 30% over the same period.

Aidan Kerr, the ABI’s Assistant Director, Head of Fraud, said: "The vast majority of customers are honest and rightly expect tough action against the fraudsters. Insurance fraud is not a victimless crime, which is why the industry invests £200 million a year in fraud detection, including funding the Insurance Fraud Enforcement Department, and developing the Insurance Fraud Register, a central database of known insurance cheats. The more that is done to crackdown on the dishonest, the quicker and more effectively insurers can deal with the claims from the honest majority.

"The message is clear: never has it been harder to get away with committing insurance fraud; never have the penalties - ranging from a custodial sentence and a criminal record to difficulties in obtaining financial products in the future - been so severe."


Related UK National News Stories
Click here for the latest headlines.

17 June 2008
Forty Charged For 'Cash For Crash' Scam
Forty people have been charged in connection with an alleged £5.3 million insurance fraud after a two-year investigation. The accused are charged with making false insurance claims following false or staged motor accidents.
16 April 2009
Insurers Detect Record Amount Of Fraudulent Claims
Insurers are detecting record levels of fraudulent insurance claims, 2,000 every week - worth £14 million - according to figures released today by the Association of British Insurers (ABI).
17 December 2013
Canoe Death Fake Arrested Over Breach Of Licence
A man jailed for faking his own death in an insurance fraud scheme has been arrested for breaching the terms of his releases. 63-year-old John Darwin was jailed for six years in 2008 after he was convicted of faking his own death in a canoe accident. In 2011, after serving half of his sentence, Darwin was released on licence.
17 December 2013
Competition Commission Criticises Motor Insurance Industry
The Competition Commission has made a number of recommended revisions to the motor insurance industry following a year long review at the request of the Office of Fair Trading (OFT). The commission described premiums as "unnecessarily high" for all drivers due to the complex chain of claims, blaming the cost of courtesy cars and repairs.
23 April 2012
Consumers Told To Make PPI Claims Directly
A summit will be held today aiming to shed light on the cost of using claims management companies for payment protection insurance (PPI) claims.