Getting better at detecting fraud
The Association of British Insurers (ABI) recently announced the heartening statistic that 350 insurance fraud attempts, worth £3.6 million, are now being detected and stopped every day by insurance companies – a rise of three per cent compared with last year. This puts levels of detected fraud at a record high for the industry, and the ABI suggests that, rather than showing that fraud is on the increase, it shows that the industry is getting better at both detecting fraud and effectively pushing for the prosecution of offenders.
Stephen Gaywood, director of counter fraud at AA Insurance (AA), responded to the figures, saying: “This shows that the estimated £200 million the industry invests each year in fraud prevention and detection is paying dividends, and confirms that those attempting to defraud their insurers are increasingly less likely to get away with it. Insurance fraud is little more than common theft. Whether it’s exaggerating a legitimate travel insurance claim, falsifying details on an insurance application to get a lower premium, or attempting a cash-for-cash collision to make a false injury claim, it is still theft.” He went on to say that ‘although these figures are to be welcomed, most insurers believe it is the tip of the iceberg’. “However,” said Gaywood, “I am concerned that with increased pressure on premiums in the industry and particularly with the insurance premium tax hike this autumn, the industry’s focus on fraud should be stepped up, so as to reduce the risk of passing the cost on to honest policyholders.”