Some 107,000 fraudulent insurance claims, worth a total of £1.2billion, were uncovered by insurers in 2019, new data has revealed.
A new scam was uncovered every five minutes, equating to 300 fraudulent claims, and just over 2,000 false applications being detected every day, according to research from the Association of British Insurers (ABI).
The frauds detected were worth £3.3million every day with a bodybuilder, police officer and a trainee GP found to be among the cheats exposed.
Claims were up five per cent on 2018 with the rise mainly due to increases in motor and property scams.
Some 107,000 fraudulent insurance claims, worth a total of £1.2bn, were uncovered in 2019
Motor insurance frauds remained the most common, up six per cent to 58,000 on 2018, although their value, at £605million, fell slightly.
Around 75 per cent of fraudulent motor claims contain a personal injury element, which may reflect some fraudulent activity ahead of the introduction of personal injury reforms in April next year.
However, although the volume increased, there was a small decrease of two per cent in the value of detected claims fraud, coming in at £1.2billion.
This resulted in a decrease in the average value of a fraudulent claim to £11,400, compared to £12,200 in 2018.
Property frauds also showed a significant increase with 27,000 dishonest claims detected worth £124million – a rise of 30 per cent in number and 8 per cent in value on 2018.
Meanwhile, the number of liability frauds fell by 14 per cent to 19,000.
This may reflect insurers clamping down on ‘trip and slip’ and noise induced hearing loss claims, as well as measures implemented by the travel sector and government to reduce dishonest gastric illness holiday claims.
Improved prevention measures and better reporting reflected a significant increase in the volume of application fraud detected, up over 200 per cent on the previous year to 760,000 cases, worth £1.4billion.
Motor insurance frauds remained the most common, up six per cent to 58,000 on 2018
Application fraud typically includes non-disclosure of previous claims.
Mark Allen, ABI’s manager of Fraud and Financial Crime, said: ‘The industry makes no apology for its relentless pursuit of insurance cheats, to protect genuine customers, who end up footing the bill through their insurance premiums.
‘Insurers will not hesitate to ensure that fraudsters seeking to profit at the misery and expense of others will suffer severe and long-lasting consequences.
‘Insurers know that the coronavirus crisis has led to financial hardship for some, and with scammers always preying on people’s anxieties, now it is especially important for consumers to be on their guard, for scams like being approached by someone offering cheap motor insurance.
‘The golden rule is never act in haste – if a deal is too good to be true, then it probably is.’
Bodybuilder caught out on Europe’s highest slide
In one case, a bodybuilder, who claimed for injuries sustained when he was knocked into a garden pond by a digger, had his claim dismissed in court for ‘fundamental dishonesty’ after he was filmed going down Europe’s highest waterslide, even though he claimed he was scared of heights.
He was also ordered to pay £14,000 in legal costs.
In another case, a trainee GP was suspended from practicing for a year, after she admitted inventing the theft of wedding and engagement rings.
Evidence against her included Facebook posts to the jeweller re-making the rings, where she admitted that it was a false claim.
A number of criminals were caught out by the City of London Police’s Insurance Fraud Enforcement Department, including a serial fraudster was jailed for more than three years after he lied about his poor claims history to secure insurance.
He then made a series of claims for theft, burglary and damage to property, including numerous escape of water claims, one of the most common insurance claims in the UK.
He was also dismissed from his employment at a claims management company for diverting £18,000 to his own bank account and attempting to divert a further £17,000.
Even a police officer was convicted for a motor fraud valued at £10,000 after he was incriminated by his own dashcam footage which showed that debris from a passing van that was alleged to have caused him personal injury and damage to his car turned out to be polystyrene.
Another man was sentenced after CCTV caught him purposely banging his knee several times on a paving stone to make a fake injury claim.
On spotting the camera, he started to hop on one leg to authenticate the injury. He claimed that the footage had been misinterpreted and that he was testing the paving stones to prevent injury to others.
Detective Superintendent Peter Ratcliffe, Head of the City of London Police’s Economic Crime Funded Units, added: ‘Insurance fraud is not a victimless crime and the effect of dishonest claims are felt by everyone.
‘As well as bogus insurance claims inevitably increasing premiums for honest customers, certain tactics used by fraudsters, such as ‘crash for cash’, put the lives of innocent members of the public at serious risk.
‘The fight against insurance fraud is an ongoing one, so we need to continue working together to prevent and detect this crime type, and ultimately bring the criminals involved to justice.’