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Surge in insurance fraud

Surge in insurance fraud

Worrying surge in insurance fraud with activity reaching £17 million in 2018.

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James Maycock

Partner

KPMG in the UK

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KPMG's Fraud Barometer identified a worrying surge in the value of alleged insurance frauds hitting courts in the last 12 months, more than was seen in the period 2014 - 2017 combined.

Overall, £17 million of alleged insurance fraud appeared in UK Courts over 19 cases in the last year, compared to 24 cases with a combined value of £11.9 million in the years 2014-2017.

Cash for crash, personal injury scams and faked death claims featured multiple times in the list of frauds coming to court. One case saw a man who masterminded a £4 million bogus insurance claim scam jailed for nine years. The scam involved orchestrating 250 collisions with innocent drivers, mainly on mini-roundabouts, making claims against dozens of insurance companies for fabricated injuries or vehicle damage. The judge was very clear in stating that all insurance customers will pay for the fraud through higher premiums.

"Insurance fraud has a massive impact on many people: the victims, insurance companies and, of course, everyone else who is left to pick up the cost through higher insurance premiums. Despite the progress that has been made, particularly with the number of people now using in-car technology to record events in real time, fraudsters will continue to come up with new and improved ways to scam the system. "Insurance scams are no longer the domain of claiming for a 'lost' camera on holiday, but like many areas of fraud have turned into a very lucrative income stream for professional criminals. The increase in professional insurance scammers coming to court goes to show the complexity of the task that the industry is tackling. Fraudsters will move quickly to new methods and exploit any area they can, staying ahead of them is a difficult challenge."

James Maycock, Partner Forensic, KPMG in the UK.

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