From a small youngster allegedly driving a automotive to pretend photograph proof of theft, Aviva has revealed a few of the most uncommon fraud insurance coverage instances obtained in 2022. But it surely does not take a legal mastermind to commit fraud – some folks could also be doing it with out even understanding.
Aviva’s personal claims knowledge confirmed greater than 9,250 situations of fraud in 2022. A number of the shady claims the insurer uncovered have been clear makes an attempt to deceive, however not everybody who commits fraud does so deliberately. In some instances, it may be so simple as making an error on a report.
Which? takes a have a look at a few of the extra frequent methods clients can unwittingly commit fraud and the way to unpick the harm for those who realise you have made a mistake.
What have been most fraudulent claims about?
Final yr, Aviva recognized almost 10,000 instances of insurance coverage fraud, price £120m in payouts.
Motor bodily damage accounted for nearly half of all instances of insurance coverage fraud. The supplier additionally discovered an increase in restore and alternative fraud, detecting 22% extra fraud on claims for broken automobiles final yr. Aviva discovered almost two-thirds was organised fraud dedicated by third events. There was additionally a rise in motor collision fraud within the final three months of 2022.
Fraudulent residence insurance coverage additionally jumped 18% final yr, whereas Aviva noticed extra bogus claims for unintentional harm, unintentional loss and theft. The highest 5 objects declined for residence insurance coverage fraud have been cell phones, televisions, jewelry, laptops or tablets, and watches.
A number of the extra ridiculous instances included a declare for motor bodily damage the place a medical report acknowledged that the motive force of the automotive was a six-year-old youngster.
Suspicions have been additionally aroused when a holidaymaker reported shedding each their newly insured wedding ceremony and engagement rings within the sea in Greece. After realising they’d been rumbled, the declare was withdrawn and the rings have been miraculously ‘discovered’ by a stranger.
One other case of fraud was foiled when the insurer noticed that the picture used to assert for the theft of a person’s watch price over £20,000 was lifted from the web.
- Discover out extra: finest and worst automotive insurance coverage corporations
Are you committing fraud with out understanding it?
Not all instances of fraud are deliberate or intentional. New analysis by fraud prevention service Cifas reveals that one in eight adults has dedicated – typically unintentionally – a number of frauds previously 12 months. That is a rise from 10% in 2022 and eight% the yr earlier than.
The survey of two,000 adults within the UK revealed respondents noticed sure sorts of shopper fraud as ‘affordable’, with 20% believing cell phone fraud was the least more likely to be unlawful. Listed below are some frequent methods clients may discover themselves in sizzling water over insurance coverage claims:
1. Withholding info
Honesty is at all times one of the best coverage. Whenever you purchase insurance coverage, reply all questions as in truth and precisely as you may. If unsure, make an observation to examine and name your insurer again to make clear any particulars.
Basic examples of this kind of fraud embody omitting pre-existing situations when making use of for journey insurance coverage, failing to tell your insurer of any upgrades to your property, or just forgetting to inform your supplier of a change of handle or occupation.
2. Mendacity on an utility
Deliberately mendacity on an utility additionally counts as fraud. Sadly, with premiums at present at a report excessive for a lot of varieties of insurance coverage, increasingly more clients could also be tempted to inform a fib or two to chop prices.
Based on Insurance coverage Fraud Bureau (IFB) analysis, utility fraud is on the rise amongst youthful drivers – with 27% of 18-24 year-olds surveyed admitting they’d take into account mendacity on an insurance coverage utility to save cash – up from 21% final yr.
3. Exaggerating
With premiums skyrocketing and value of dwelling pressures nonetheless squeezing many households, it might be tempting to magnify in a declare the extent of injury brought on or the quantity of economic loss. It could look like a white lie however embellishing a declare for monetary acquire, or offering false info when making use of for insurance coverage is classed as ‘opportunistic’ fraud.
Based on the Metropolis of London Police’s Insurance coverage Fraud Enforcement Division (IFED), ‘opportunistic’ insurance coverage fraud instances rose by 61% between March 2022 and April 2023, with motor insurance coverage accounting for 51% of instances the unit obtained and property insurance coverage fraud the second highest at 29%.
A survey carried out in June by the IFB additionally discovered one in 10 folks stated they’d take into account making a fraudulent insurance coverage utility or declare in the event that they have been struggling financially.
4. Fronting
You possibly can, legally, scale back your premium by including an older, extra skilled driver to your coverage. But when they’re named as the principle driver, after they’re not that is known as ‘fronting’.
It is one other apply that will seem victimless however may see you caught out by an insurer’s fraud investigators.
Younger drivers who would usually pay a a lot increased premium are more than likely to do that, particularly contemplating the massive hikes in premiums not too long ago. The common price of automotive insurance coverage for younger drivers has gone up by 50% in phe final yr, in line with new analysis by Examine the Market.
Normally, the price of getting added to your mother and father’ insurance coverage ought to be cheaper than taking out a separate coverage for your self. However Which? discovered it does not at all times work out to be any extra inexpensive.
5. Modifications
Pimping your journey or including further safety features that add worth to your automotive or increase its efficiency may improve the price of your motor insurance coverage premium.
You must subsequently at all times let your insurer know for those who’re making any modifications to your car, or for those who purchase a automotive that you already know has been modified. Failing to take action might be thought of fraud by your insurer.
- Discover out extra: the commonest varieties of insurance coverage fraud
Fraud can have critical penalties
If you’re discovered to have dedicated fraud, not solely may your insurance coverage coverage be invalidated, however you may additionally doubtlessly have your title added to the Insurance coverage Fraud Register.
That is an industry-wide database of identified fraudsters, utilized by insurers when making underwriting choices and assessing claims. If you find yourself on the record, you may battle with any future insurance coverage functions, credit standing and mortgage functions.
You could possibly additionally face fines or within the worst instances, prosecution and a legal report.
What if the insurer is incorrect?
Should you consider you have been wrongly accused of fraud by your insurer, there are some things you are able to do.
Acquire as a lot proof as you may to show you aren’t accountable or that you’re certainly telling the reality. If there’s a witness or – much more highly effective – photographic or video proof, that may additionally aid you combat your nook. If it pertains to automotive insurance coverage, dashcam footage can be used to substantiate particulars of the occasion.
Lastly, for those who assume your declare has been mishandled, make a grievance and, if wanted, elevate it additional with the Monetary Ombudsman Service. These steps aren’t assured to get you the result you need, however they’re no less than a approach of getting your declare re-evaluated.
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