London Based Insurer, Aviva, Of United Kingdom States £230,000 In Bogus Insurance Claims Made Every Day
By Lonce LaMon from Source: Belfast Telegraph - May 29, 2017
A major insurer, headquartered in London, which is multinational with around 33 million customers across 16 countries, detected nearly a quarter of a million pounds worth of bogus claims every day in 2016.
Aviva saw a 9.5% year-on-year jump in the number of fraudulent claims it declined in 2016. This was manifested by increases in fraud detection across vehicular bodily injury, household, and liability claims.
It declined one in 10 whiplash claims for proven or suspected fraud last year.
The insurance giant said, in total, it detected more than £85 million of insurance fraud in 2016, or around £232,000 worth of bogus claims every day. The majority of fraud it detects is from third parties who are not its customers.
Whiplash fraud, according to Aviva, remains a major concern. Bodily injury frauds such as exaggerated or bogus whiplash claims continue to account for the majority of fraud Aviva identifies. Bodily injury fraud accounts for 59% of the total fraud Aviva detects.
Aviva said it is currently investigating more than 16,000 suspicious bodily injury claims.
Organized crime fraud accounts for much of the new injury fraud. Last year, Aviva declined claims worth more than £25 million linked to fraud rings. Aviva is currently investigating more than 3,000 suspicious whiplash claims linked to organized fraud groups.
A growing trend in bogus household claims stems from "serial claimants", fraudsters who make multiple claims, often for the same item, by purchasing dozens of home insurance policies using different aliases. Policies are taken out with the sole aim of making fraudulent claims. Although these scams are still rare, it now detects more than six of them every month.
The most common fraudulent household claims were for accidental damage, theft and accidental loss. The average value of a fraudulent household claim was £1,315, with values ranging from as little as £25 up to £83,560. Aviva stated a large number of relatively low value claims indicates that fraudsters believe insurers will not scrutinize low-value claims.
Liability claims, made against an employers' liability or public liability policy, is also an issue. Aviva has more than 1,000 suspicious liability claims under investigation.
The insurer said as the industry works together to clamp down on "crash-for-cash" vehicle collisions staged by criminals, it is believed that fraudsters are moving into new areas and making bogus public and employer liability claims.
Tom Gardiner, head of the fraud division at Aviva, said: "We vigorously defend our customers against fraudulent claims, even where it is not economical to do so, and will prosecute those people making fraudulent claims wherever possible.
"Looking at our bodily injury fraud data, it is clear that there continues to be an urgent need for fundamental reform of how minor personal injuries are compensated.
"The growing number of these scams is putting pressure on premiums. And, in the case of crash-for-cash, innocent motorists are put at risk and scarce public resources are diverted away from real need, such as emergency services, GP and A&E time.”
lonce@adjustercom.com
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