Fraudulent insurance claims have risen by 17% since 2007, according to new statistics published by the Association of British Insurers. Companies are uncovering a record amount of 2,000 fake claims every week, worth a staggering £14 million, with motor insurance proving to be the most common - £360 million in false claims was recovered for this alone.
Home insurance takes second place, with 55,000 fake claims detected. The research shows that there were 107,000 fraudulent claims made last year, making up a total value of £730 million - an increase of 30% since 2007.
These shocking figures are being blamed on the recession, as policy holders turn to increasingly desperate measures to make extra cash - and seem to be getting more and more brazen about it. Amongst those uncovered include a man who reported his car stolen after an attack when it later transpired that he’d actually sold the vehicle to a friend.
Another car that was reported stolen and recovered burnt out had actually been set alight before the owner had even reported it missing. He later received a criminal conviction for his deception. Despite this ominous warning to others, a second survey by the ABI revealed that one in five of us are tempted by making false claims. But for every dishonest claim, innocent policy holders suffer in the long term as premiums go up.
Nick Starling, the ABI’s Director of General Insurance and Health, explained:
“Fraud thrives in a recession, so insurers are intensifying their crackdown on insurance cheats. Fraud adds an extra £40 a year to the average premium, which is why the harder we make it for the cheats, the more competitive premiums will be for honest customers. Cheating on your insurance really does not pay - you will get caught, future insurance will be more expensive and, along with credit, harder to obtain. The only thing you are likely to gain is a criminal record.”