Fool News: Fraudulent Insurance Claims Cost £1 Million A Day
Insurance companies are stopping fraudulent claims to the tune of over £1 million.
Insurance companies are stopping fraudulent claims to the tune of over £1 million a day, with overall undetected fraud estimated at approximately £1.6 billion a year.Recent research into general insurance conducted by the Association of British Insurers (ABI) has shown that insurers are uncovering fraudulent claims worth £480 million a year - a figure three times higher than the amount detected in 2003. What's more, the insurance companies reckon there is plenty more fraud being committed, they just haven't detected it yet. The best estimate for undetected fraud in the UK is around £1.6 billion a year.The ABI also estimates that around one in 11 claims is in some way fraudulent. Of these, 85% involved exaggerating the value of a genuine loss.The ABI's research also found that men are 1.6 times more likely than women to lie or stretch the truth when it came to claims. In addition, people living in the north of England are 1.7 times more likely to have committed insurance fraud than average.Those who were over 45, homeowners or who paid premiums of more than £500 a year were identified as less likely to tell porkies to their insurer.Interestingly, the research found that the higher the amount of savings a person possesses the more likely they are to have committed insurance fraud. Reasons cited for this were that those with higher savings tend to hold more insurance products, therefore are more likely to make an insurance claim and have the opportunity to commit fraud.Some of the more colourful claims uncovered by insurers include a man claiming for `recovery expenses' following a heart attack suffered while on holiday in West Africa. In reality, the services rendered were actually for the use of a local brothel. Another case tells of a keen amateur footballer claiming to be unable to work following a back injury. He was exposed when a local newspaper printed his picture after he was named as his local football club player of the year.More: Halve The Cost Of Home InsuranceVisit The Motley Fool Insurance Service and get a great quote!