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Insurance fraud falls overall - Financial news from Quotesure - 13/04/2011

But fraud is still rife in all areas of insurance
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Insurance fraud falls overall

There was some good news for the insurance industry as a whole when it was reported recently by Experian that the overall number of attempted insurance fraud had fallen by 5%. This worked out to be nine out of every 10,000 policy applications being detected as fraudulent. The overwhelming majority of fraud cases stemmed from first-parties who were responsible for non-disclosure of previous claims or other relevant information. For home insurance policies, 27% of frauds detected in 2010 involved a staged incident or items added to a list of otherwise genuinely stolen goods.

Car insurance fraud was mostly discovered to be in the area of non-disclosure of claims or convictions which accounted for 48% of attempted fraud and 8% were down to cases where policy holders attempted to commit fraud by “fronting”, where a parent or lower risk individual was falsely claimed to be named as the main driver.

A further 21% of fraudulent claims where based on staged events when fraudsters attempted to claim on an insurance policies previously obtained using another persons identity.

On the whole, the UK financial services witnessed an overall increase in attempted fraud of 11% compared to 2009. In 2010, 20 out of every 10,000 applications for credit and other financial products where found to be fraudulent.

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