Insurance fraud is on the increase – but numbers coming from the United Kingdom show a year-over-year increase of 19 per cent in 2013.
According to
Aviva, it detected more than £110 million ($177.5 million) worth of insurance fraud in 2013 in the United Kingdom, up 19 per cent over 2012.
“A combination of factors including the economic climate, social attitudes toward insurance fraud as a ‘victimless crime,’” said Tom Gardiner, the head of Aviva’s fraud operations, “and a lack of effective deterrents are increasing the frequency of insurance fraud.”
Aviva said it detects more than 45 fraudulent claims per day worth more than a total of £300,000 ($484,184).
According to the company, fraud is increasingly being committed by third parties not insured by Aviva, but making claims against Aviva customers, and also by organized gangs.
“The good news is that we are constantly improving our ability to prevent and detect fraud, helping to keep premiums down for innocent policyholders,” said Gardiner. “The ABI estimates fraud adds £50 ($80) to the cost of insurance premiums.”
Motor injury fraud make up 54 per cent of Aviva’s detected fraudulent claims, and more than half of those were from organized “cash for crash” claims, the company said. (continued.)
#pb#
In research by Aviva conducted among about 2,000 adults in the U.K. last year, nine out of 10 people said insurance fraud is unacceptable and 64 per cent said they want insurance companies to do more to fight fraud.
However, 66 per cent of people wouldn’t report it to the police if someone they knew committed insurance fraud, up 53 per cent from a recent Aviva survey.
Additionally, only one in 10 people thought they would be affected by fraud, Aviva noted.
Aviva’s research also found that 23 per cent of people knew someone who had exaggerated a genuine claim and 17 per cent knew someone who had faked a whiplash injury to obtain compensation. The number of people surveyed who said they would consider exaggerating a claim also increased by 35 per cent to more than one in eight, compared to five years ago.
