Insurers continue to count the cost of soaring fraud

With annual fraud losses across the UK now reaching £70 billion, it is estimated that insurance fraud now tops £2 billion.

The number breaks down into an estimated £1.7 billion in undetected fraud losses, £38 million in detected insurance fraud when claims get paid before being flagged as fraudulent and £350 million in organised staged motor vehicle accidents.

More than half (58%) of all insurance fraud involved some form of product abuse, most significantly the provision of false payment information.
The vast majority of fraud – more than 90 per cent – is being carried out by consumers or ‘non-professional’ fraudsters, so-called first-party fraud.

The past financial year saw a shift from the more traditional types of fraudsters. Fraud continues to be centred on London and the Home Counties, with acute problems in the inner-city boroughs of Tower Hamlets, East Ham, Woolwich and a broad westward migration along the Thames Valley. But this is just a snapshot. For more detailed insight on insurance fraud, please click here.