Insurers uncovered a record £840 million worth of fraudulent claims in 2009, figures have shown.
A total of 122,000 insurance claims were rejected by the industry for being fraudulent during the year, 14% more than in 2008, according to the Association of British Insurers. The rise is likely to be due to a combination of insurers becoming increasingly sophisticated in their fraud detection, as well as an increase in the number of people submitting misleading claims due to the economic downturn.
Overall, insurers uncovered an average of 2,000 dishonest claims worth £16 million every week. Around 4% of all claims by value which were received by insurers during 2009 were found to be fraudulent, nearly double the figure for five years ago. Motor insurance fraud accounted for nearly half of the total, with fraudulent claims worth £410 million uncovered during the year. But home insurance accounted for the highest number of dishonest claims at 62,000.
The industry also uncovered 8,500 misleading liability claims, with many involving bogus personal injuries which would have cost insurers an average of £25,000. Insurers noticed a rise in the number of people attempting to claim against their local authority for injuries they said they sustained in accidents in the street. In one case, a man claimed he had injured his hand after tripping over a pothole in the street.
But it later transpired he had actually hurt himself when he punched a wall during a domestic argument. In another case, a young woman said she had tripped over a loose piece of pavement, but her injuries were actually sustained when she jumped down a flight of stairs while running away from security guards who suspected her of shoplifting. Nick Starling, the ABI’s director of general insurance and health, said: “Reducing fraud remains an ongoing battle for the insurance industry.”
July 22, 2010 (The Press Association)
