The Association of British Insurers (ABI) estimates that fraud adds, on average, an extra £50 to the annual insurance bill for every UK policyholder. In 2013, insurers uncovered 119,000 dishonest claims worth nearly £1.3bn across all insurance products. The ABI estimates that an additional £2.1bn a year remains undetected.
Insurers invest at least £200m every year to identify fraud. In addition to improving their own anti-fraud systems, they fund industry initiatives such as:
THE INSURANCE FRAUD BUREAU
A not for profit body focused on the detection and prevention of organised fraud launched in July 2006. Since its launch there have been numerous arrests and tens of millions of pounds of savings for insurers and their customers as a result of its actions.
THE INSURANCE FRAUD ENFORCEMENT DEPARTMENT
A specialist police unit dedicated to prosecuting insurance fraudsters was launched, for England and Wales, in January 2012. In the first six months of operation, it received 318 referrals from 43 different insurers to investigate.
THE INSURANCE FRAUD REGISTER
An insurance industry database of known fraudsters launched in September 2012.
According to the ABI’s report on Insurance Fraud: “Reducing and deterring fraud remains a priority for the insurance industry. It is an on- going battle as the fraudsters continually look for new ways to de-fraud insurers and honest customers. The industry makes no apologies for its zero tolerance approach to weeding out the cheats. Honest customers expect nothing less.”