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ABI: Insurance fraud has increased

By Marianne Straker, Fri 17 Jul 2009 - Published in Life Insurance

The Association of British Insurers (ABI) has revealed the rising costs which are being created by insurance fraud.

A new report from the organisation claims that the cost of the crime is now thought to have hit £5.2 million each day.

According to the research, the annual cost of undetected fraudulent insurance claims has reached around £1.9 billion, representing a 24 per cent increase on the £1.6 billion reported two years ago.

In addition, the crime adds an average of £44 a year to each home's insurance bills.

The report also revealed that there has been a 30 per cent increase in the number of offences that insurers are detecting, with frauds worth £730 million prevented in 2008.

Nick Starling, director of general insurance and health at the ABI, commented: "There is no hiding place for insurance cheats. Honest customers should not have to pay for the fraudsters.

"The tough approach taken by insurers to protect honest customers means that they are detecting more of the fraud committed."

Earlier this week, Neil Munroe, external affairs director at Equifax, highlighted the importance of people not lying when applying for mortgages.