The University of Portsmouth has released a new study estimating the annual cost of fraud in the UK’s insurance sector at £1.3bn.
The Annual Fraud Indicator 2016 cited latest figures from the Association of British of Insurers (ABI), which claimed that the value of insurance frauds detected has reached an all-time high.
According to the research released this month, insurers detected 130,000 fraudulent claims in 2014 or about 350 every day. The overall value of frauds uncovered increased by 57% in five years.
Motor insurance frauds were the most common and costliest as 67,000 cases valued at £835m had been detected.
The number of liability insurance frauds discovered has jumped by 75% to 19,800, with a value of £330mn.
Meanwhile, the number of detected fraudulent property insurance claims has decreased by 29% to 24,533.
The Annual Fraud Indicator estimated the total yearly cost of fraud in the UK at £193b or nearly £3,000 per person.
Private sector fraud losses were valued at £144b per year while public sector fraud cost was estimated at £7.5b.
Fraud committed directly against individuals was pegged at around £10b. Charities and charitable trusts lost up to £1.9b to fraud each year.
“No one knows the true cost of fraud in the UK, but it’s taking place on an industrial scale and is without question one of the biggest crimes afflicting UK plc today,” said Professor Mark Button , director of the Centre for Counter Fraud Studies at the University of Portsmouth.
“It is unrelenting and indiscriminate with many organisations estimated to be losing around five per cent of their annual revenue to fraud,” he added.