Health & Safety

The Association of British Insurers (ABI) have just released figures for 2010 showing the level of insurance fraud in the UK. Rather disturbingly it shows that insurers uncovered 133,000 fraudulent claims amounting to the total sum of £919 million. This is a 9% increase on the previous year. In the last 5 years the number and overall value has risen by 100%. Those which are detected can only be the tip of the iceberg and indeed the industry estimates that insurance fraud costs £2 billion per year, which equates to an extra £44 a year to the insurance bill for every UK policyholder.

The most common frauds involved home insurance (66,000) although dishonest motor frauds was relatively close behind, numbering 40,000, is it typical that a victim has to hire a motorcycle accident attorney in the UK in order to be able to obtain compensation.

“Cheats” uncovered include a female claiming facial injuries from a falling toilet roll holder which would have required to have fallen upwards to have caused the injury claimed. In another claim Facebook images of the claimant performing gymnastics and training for a charity run disproved an alleged back injury she sustained at work.

Such is the level of fraudulent claims that next year a national Insurance Fraud Register will be set up containing the details of all known “insurance cheats”, and at the same time the first ever national police insurance fraud investigation unit will begin its operations. The intention is that fraudsters will find the insurance industry a more hostile environment.

We take a number of steps on behalf of our clients to help detect fraudulent claims. It will be interesting to see the effect that the new register and police unit have in identifying fraud and how we and our clients can use the new measures most effectively.