The data, covering the period from March 2022 to April 2023, suggests a surge in “opportunistic fraud” rather than organised fraudulent activities.
Instances of opportunistic fraud include exaggerated claims and the provision of false information during insurance applications. Examples range from fabricating injuries following a genuine road traffic accident to making duplicate insurance claims for lost jewelry. The IFED has cautioned the public against resorting to fraudulent activities as they struggle with rising costs and financial constraints.
Motor insurance fraud emerged as the most common form of opportunistic fraud, accounting for 51% of cases reported to the IFED during the specified period. Property insurance fraud followed closely behind at 29%.
In response to the rising trend, the IFED conducted an operation that investigated 18 opportunistic claims, estimated to be worth £216,875 in total. The operation resulted in multiple search warrants, charges, and arrests across the country.
Several individuals have been brought to justice, including a woman charged with fraudulently claiming personal injury following a collision, a man fined for submitting claims for the same television on two different home insurance policies, and another man cautioned for tampering with hotel invoices to inflate costs for an insurance claim related to water damage.
Tough consequences for insurance fraud perpetrators
Law enforcement agencies and insurance providers have laid out the potential consequences of engaging in fraudulent activities. Detective Chief Inspector Tom Hill of the IFED at City of London Police warned that insurance fraud can lead to a criminal record, criminal prosecution, and imprisonment, making it harder to obtain insurance in the future. Offenders may also be added to the Insurance Fraud Register, which can restrict access to essential insurance services for several years.
Mark Allen, Assistant Director and Head of Fraud and Financial Crime at the Association of British Insurers, highlighted that while insurers understand the financial pressures faced by households, resorting to fraudulent insurance claims would only exacerbate financial difficulties and result in criminal records. He encouraged individuals struggling with insurance affordability to communicate with their insurers to explore available support options.
Jon Radford, Head of Intelligence, Investigations, and Data Services at the Insurance Fraud Bureau (IFB), echoed these sentiments, said that insurance fraud brings severe consequences, including being denied access to essential insurance services for up to five years. The IFB collaborates with the IFED and insurer members to detect and disrupt fraud networks nationwide, aiming to make life more challenging for scammers.
Radford urged individuals not to take the risk of engaging in fraud, as the potential consequences far outweigh any short-term financial gain.
