Fraudulent or exaggerated insurance claims can push the average cost of a policy up considerably and leave innocent policy holders out of pocket. However, recent statistics have revealed a crack-down by insurance providers is proving successful.
Insurance Fraud Cases Are Decreasing
According to the Association of British Insurers (ABI), 125,000 dishonest insurance claims were detected in 2016 - valued at £1.3 billion. This averaged out as around 2,400 claims a week, worth £25 million.
Although this may sound a lot, this was 5% lower than in 2015 and organised fraud fell by around 30% too - 15,000 fraud cases worth £174 million were detected.
Some of the most extreme and unusual insurance fraud cases that were revealed during this time included a man who claimed £35,000 on a sickness policy over three years, claiming to be suffering from depression and anxiety that left him housebound. He was later caught singing with a tribute band.
Whereas another case saw six people convicted for a scheme that involved bogus personal injury and business interruption claims worth nearly £600,000.
James Dalton, ABI's Director of General Insurance Policy, said:
"The vast majority of insurance claims are genuine, with millions being paid to customers every day. The industry does everything it can to keep premiums down and tackling fraud, which drives up prices for honest customers, is at the heart of that. So it's great to see we have achieved real success in tackling organised fraud in the last year."
Head of the City of London Police's Insurance Fraud Enforcement Department, Detective Chief Inspector Oliver Little said:
"The successful and strong relationship between the City of London Police's Insurance Fraud Enforcement Department (IFED) and the ABI can be seen by these figures. This is a fantastic example of IFED working closely with the insurance industry to ensure that consumers are protected from such claims and perpetrators are brought to justice.
"Insurance fraud is taken extremely seriously and the consequences for those involved are severe. IFED will continue to work with the ABI to target those who carry out this activity."
What Does This Mean for You?
As we reported back in January 2017 in our post 'Insurance Fraud Falls by 13% - What Does That Mean for You?', fraudulent claims are one of the key reasons why policy premiums increase so much annually here in the UK. Hopefully, as the number of these cases decreases, plan prices will stabilise.
Of course, there is another way of ensuring you're getting a great deal for your money. If you compare business insurance policies online. At Business Compare we can help protect your business in minutes, utilising our close relationships with insurers and vast experience of the industry.
Get in touch to learn more. Call 0333 202 6240.
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