16/04/03

Latest ABI research reveals why some people try to cheat on insurance as anti – fraud drive exposes commonly attempted fraudulent claims.

Research published today by the ABI (Association of British Insurers) reveals for the first time why fraudsters try to cheat on their insurance. Many see insurance fraud as a victimless crime – despite the fact that fraudulent claims on motor and household insurance alone now cost insurers and their honest policyholders £20 million a week.

By better understanding what motivates some people to make a fraudulent insurance claim, insurers can reduce the risk of an honest policyholder being tempted to act dishonestly.

The most common reasons given by fraudsters to justify cheating were:
- Most people do it (23%)
- It does not harm anyone personally (22%)
- Insurers can afford it (20%)
- You are unlikely to get caught (16%)

The most common reasons (or a combination of) insurance fraudsters said they cheated on their insurance were:
- To get some money back after years of paying premiums (43%).
- To cover the cost of the excess (30%)
- To pay for the cost of the insurance policy (26%)
- To replace damaged items with a better model (25%). For example, damaging a chair to get the whole lounge suite replaced.

The prospect of being refused future insurance (47%), and the risk of a prison sentence (41%) are most likely to deter those who admitted to insurance fraud from doing it again.

Commenting on the research, Debra Weekes, the ABI’s Head of Financial Crime Prevention said: “Life is about to get even tougher for insurance cheats. While insurance fraudsters come in all shapes and sizes, this research will help insurers have a clearer picture of what drives insurance fraud. Insurers are not only committed to reducing insurance fraud, but to do everything possible to ensure that honest policyholders do not become dishonest ones”.

Provided by the ABI