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Insurance fraud costs £2 billion every year, data suggests

Date: 17/09/2014 10:09:55
Category: Insurance
Author: Graeme Parton

More than £2 billion worth of car insurance fraud is committed every year, new industry data suggests.

According to the Association of British Insurers (ABI), UK policy providers discovered around 3,500 illegal policies every week in 2013 - or more than 180,500 for the whole year.

Many of the fraudulent applications involved drivers who had knowingly failed to disclose details of previous claims. Others lied about historic motoring convictions, theguardian.com reports.

While the figures seem high, this is the first time that an industry body has collected such data, so the ABI was not able to say whether there had been any notable changes from previous years.

Head of fraud at the ABI, Aidan Kerr, urged drivers to be truthful in their applications. He was quoted by yahoo.com as saying: "While insurers know that innocent mistakes and oversights do happen, they are also aware that some people think that being less than honest is a way to get cheaper cover, when the way to get the best deal is to play it straight with the insurer."

In its report, the group estimates that fraudulent policies cost honest drivers around £50 per year in higher premiums. It also hopes, however, that the new MyLicence data-sharing platform will allow providers to obtain more accurate information from their applicants.

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