Scammers beware – the net’s closing in as insurance providers foil £25 million worth of fraudulent claims every week.
Figures from the Association of British Insurers (ABI) show that there were 125,000 identified cases of insurance fraud in 2016, valued at £1.3 billion. That figure sounds staggeringly high, but it’s a reduction of 5% compared to 2015, with the actual value falling by 3%.
A crackdown on organised fraud has been one of the biggest contributing factors in the overall reduction of insurance scams. Organised crimes include so-called ‘crash for cash’ cons, whereby criminal gangs stage vehicle accidents – often endangering the lives of innocent road users.
Work carried out by the Insurance Fraud Bureau (IFB) and specialist police teams have uncovered 15,000 cases of organised fraud, valued at £174 million. That figure’s down by a more-than-respectable 30% – saving insurance policy holders money and, potentially, lives.
The reduction in organised motor fraud means that in 2016 there were 69,000 identified cases of car insurance fraud – that’s 4% less than in 2015. But while it’s good news indeed when it comes to the big boys of crime, there’s been an increase in the number of opportunistic motor fraud, such as false or exaggerated whiplash-style claims.
Official ABI statistics show that in 2016, although the number of opportunistic fraud cases remained the same compared to 2015, more of them were uncovered – 57,000 in contrast to 54,000 the year before.
According to the ABI, those taking the opportunity to make fraudulent car insurance claims are usually law-abiding citizens, often encouraged to make false or exaggerated statements by unscrupulous claims management companies (CMCs). Unfortunately, the side effect of fraud is that insurance providers often have little choice but to raise premiums for everyone in order to offset real and potential losses.
With car premiums rising rapidly and no sign of respite on the horizon, the prospect of paying for other people’s crimes doesn’t seem fair at all. Which is why honesty is always the best policy when it comes to car insurance – whether that’s not giving into pushy CMCs or being upfront with your insurance provider when it comes to your policy.
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