One insurance scam is detected every minute, figures show

ONE insurance fraud is being detected every minute across the UK typically, according to industry figures.

More than half a million insurance frauds were uncovered in 2017, from people lying to get cheaper cover when making an application, to making dishonest claims, the Association of British Insurers (ABI) said.

A total of 562,000 insurance scams were detected by insurers.

Of these, there were 113,000 fraudulent claims, collectively valued at £1.3bn, and 449,000 dishonest insurance applications.

The number of dishonest insurance claims, at 113,000, was down by 8% on 2016. The ABI said the fall reflects industry efforts to team up to combat fraud.

Insurers detected 449,000 cases of confirmed or suspected application fraud, where people lied or withheld information to try to get cheaper cover.

The ABI has published application fraud figures for the first time, so comparisons for previous years are not available.

It said motor insurance made up the bulk of dishonest applications, with typical lies including the nature of the applicant’s job and driving record, where previous claims and motoring convictions were not disclosed.

Organised frauds, such as staged “crash for cash” motor accidents, fell by 22% compared with 2016, with frauds worth £158m detected.

The ABI said this reflects the work of the Insurance Fraud Bureau (IFB) and the Insurance Fraud Enforcement Department (IFED) – a specialist police fraud unit investigating insurance fraud.

Since its formation in 2006, IFED has secured more than 400 court convictions for insurance fraud.

James Dalton, ABI’s director, general insurance policy, said: “The vast majority of insurance customers are honest, and they rightly resent fraudsters pushing up their insurance costs.

“This is why the industry makes no apology for spending around £250m a year on measures to tackle insurance fraud.

“It is good that organised fraud fell, especially as scams like staged accidents can often put lives at risk and involve huge amounts of money.

“But with the Insurance Fraud Bureau currently investigating a rising number of suspected insurance frauds, there will be no let-up in the crackdown on the insurance cheats.”

The value of detected fraudulent motor insurance claims, at £775m, increased by 4% on 2016. The number of these frauds, at 67,000, also showed a small rise, the ABI said.

Fraudulent property insurance claims fell. The number detected dropped by 11% on 2016 to 22,000,