Motor insurance has been worst hit with 34% increase in fraudulent claims
Ordnance Survey, a UK-based Insurance Fraud Investigator (IFI), has revealed through its new research that insurance fraud continues to increase this year as well.
As per the research findings, nearly three quarter (74%) of those interviewed have witnessed an increase in fraudulent claims since the beginning of 2009, and the problem is showing no signs of leveling out.
Four out of five (80%) investigators assume the situation will continue to get worse as they envisage the top issues like the credit crunch further fuelling fraudulent claims, followed by fraud being committed at the point when people first take out their policies (43%).
Motor insurance has been worst hit with 34% of IFI’s seeing an increase in fraudulent claims, although the problem is prevalent across the board in all classes of insurance.
Over two in five (44%) have seen an increase in the volume of fraudulent claims made and a similar number (46%) have seen an increase in both the volume and in the monetary value of claims made. Over half (57%) have seen a rise in the number of completely bogus claims made, followed by inflated claims (54%).
Consequently, fraudulent activity has moved up the agenda of most organisations (68%) and there has been increased investment in fraud detection (60%) to check the problem, including fraud detection systems, supporting technology and staff.
Sarah Adams, manager of Insurance and Banking Sector at Ordnance Survey, said: “Insurance companies are not tolerating fraudulent activities and are making it a priority to crackdown on insurance cheats. One area that is being used to effectively tackle the problem is the use of geography and mapping, which is being used by around three quarters of Insurance Fraud Investigators to help highlight hot spots or patterns of fraud, and to help validate claimant information.”