The good practice guide has been developed by SOCP in accordance with the Financial Conduct Authority’s stated definition of insurance fraud, which is described as an instance in which ‘someone invents or exaggerates a claim or does not tell the truth in order to obtain cheaper cover’. It is built around four key recommendations, primarily angled to help claims professionals identify the difference between a genuine case of fraud and a situation in which a claimant may have misinterpreted their policy in good faith.
These recommendations are: treat customers fairly; maintain high-quality data; understand the ‘fundamental dishonesty rules’; and make sure to keep up to date with new types of fraud as they rear their heads.
“It is important to note that, according to ABI statistics, more than 112,000 cases of attempted claims fraud were detected in 2017, worth nearly £1.3 billion,” commented Jeremy Trott, SOCP’s Non-Executive Director. “However, while fraud is still a timely and costly drain on the insurance sector, claims should still be considered carefully so that, not only is fraud recognised where it genuinely occurs, but also that clients have access to protection when it is warranted.”
The full guide can be read here.