Insurance companies are uncovering more than £1million worth of fraudulent insurance claims every day, according to new research from the Association of British Insurers (ABI).
The study showed that each year, insurers are uncovering and preventing claims made unlawfully to the tune of £480million – three times the amount recorded in 2003.
Figures revealed that one in 11 claims made to insurance companies are fraudulent in some way – 85 per cent are where claimants are exaggerating their loss in some way, either saying more was stolen or damaged than was, or that the loss was worth more than it actually was.
And it is house insurance claims that are most likely to be fraudulent – nearly half of all detected cons were on household insurance. The most common scam was found to be where people damage their carpets on purpose and claim it was an accident in order to get new carpets fitted.
The ABI estimates that those people who are making fraudulent claims on their policies are adding around £40 to the premiums of honest customers, but, says Nick Starling, Director of General Insurance and Health at the ABI, the industry is fighting back.
“Insurance cheats are more likely to be caught than ever before,” he said, “and cheats will pay a high price as future insurance and credit will be more expensive and harder to obtain.” Compare home insurance
© Fair Investment Company Ltd