Insurance Fraud Increasing

Article published on 29th June 2008

Independent Television News (ITN) has today revealed that insurance fraud is on the rise in the UK, and they suggest that the credit crunch may be the key factor for this.

Apparently, fraudulent claims on insurance policies have risen by a record 13% in just three months, causing honest policy holders a rise of £30 a year as the insurance companies distribute the cost.

To put that in terms of gross yearly cost, last year insurance companies uncovered fraudulent claims about £575 million, which was an increase of as much as £100 million on the previous year. ITN reported that Malcolm Tarling from the Association of British Insurers said actual level of fraudulent and the costs incurred by them could be much higher.

Although many fraudulent claims are withdrawn when queried, there are still many that get through to the point of criminal proceedings, or, at worst, that are never discovered.

Fortunately, this sort of insurance cheating is much harder to achieve with health insurance, income protection insurance, health insurance and life insurance, as medical notes and official documents are required by insurance companies to prove that the policy being claimed from really is for someone who is ill, out or work, or, well... dead.

Even so, for those insurers that have many different sorts of insurance, including property insurance, costs incurred in one part of the business due to fraud may still be distributed across the entirety of the business, meaning that people buying health or life policies (etc) might still face additional costs because of it.

If you have information about someone who you have good reason to believe is involved in insurance fraud, contact the Insurance Fraud Bureau (IFB) Fraud Cheatline on 0800 328 2550. All calls are free and confidential.

Source: itv.com



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