%20released%20figures%20that%20showed%20122,000%20fraudulent%20claims%20were%20uncovered%20in%202009,%20up%20by%2014%20per%20cent%20on%20the%20previous%20year.A%20spokesperson%20from%20the%20Association%20of%20British...){kind=link}
Bogus insurance claims are driving up the cost of premiums for everyone
Bogus car and home insurance applications from deceitful people has seen the value
of detected insurance fraud increase to a record 840 million in the UK during 2009.The Association of British Insurers (ABI) released figures that showed 122,000 fraudulent claims were uncovered in 2009, up by 14 per cent on the previous year.
A spokesperson from the Association of British Insurers said, "Our honest customers rightly object to having to pay higher premiums to subsidise the fraudulent minority, which is why insurers continue to up their game in the war on the cheats."
Fraudulent car insurance claims were the highest in value, but the most common false claims were for home insurance cover with 62,000 bogus applications detected last year. Instances of fake home insurance claims ranged from exaggerating items on an application to dropping old pieces of furniture downstairs in order to claim for newer models.
The study also found that the rise in the cost of car insurance, which has grown at its fastest ever rate, was largely down to an increase in bogus claims being made.
The report highlighted a big rise in organised fraud, where criminals work in gangs to defraud insurance companies.
Cash for Crash' is the most common tactic used by dishonest groups of people, who stage accidents. These types of incidents normally occur at roundabouts and involve a car slamming their brakes on suddenly to cause the car behind them to crash into them. The fraudsters then claim for the repair costs to their car or receive a replacement of their vehicle on the innocent motorists insurance.
During the three months to the end of June 2010, car insurance premiums rose by 11.5 per cent to 704 for the average annual comprehensive car policy.
The number of detected fraud cases is at a record high, however, the total cost to the insurance industry for general claims that have not been detected as fraudulent is estimated to cost around 2 billion a year, which will typically add 44 to the annual insurance premiums paid out by all policyholders.
Bogus insurance claims are driving up the cost of premiums for everyone
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