The rise in pet insurance fraud – in 2011 the value of pet insurance fraud quadrupled, making it the fastest growing area of insurance fraud – and whiplash fraud are among the subjects at a conference on insurance fraud.
Fraud, say event organisers the ABI (Association of British Insurers) impacts on insurers, their customers and society in general. Insurers incur costs in investigating suspected frauds, which also impact their ability to deal with genuine claims quickly. For honest customers, it leads to higher premiums, the sector points out. ABI estimates that fraud adds, on average, an extra £50 a year to the annual insurance bill for every UK policy-holder. Insurance fraud is also known to fund and facilitate other serious crime. Hence a conference ‘Beating the fraudster’ on September 13, at the ABI 7th Floor Conference Suite, EC2V 7HQ. For more information contact Andrew Woolgar at [email protected] and for all other information contact [email protected] or call 020 7216 7485.
Speakers invited include from the Home Office, James Brokenshire MP, Parliamentary Under Secretary, Crime and Security; David Neave, Chairman of the Insurance Fraud Bureau and Director of General Insurance, Co-Operative Financial Services; Richard Davies, Global Fraud Control Officer AXA SA and Head of Fraud AXA UK; and Ashton West, Chief Executive, Motor Insurance Bureau. As background, the insurance industry has agreed funding for a joint project with the DVLA which will enable insurers to get accurate information about driving offences, including points and disqualifications.
The project, which has been in development for three years, will now be built by DVLA, and could be in place as early as 2014.This is a major initiative in reducing fraud, which should save honest motorists money on their motor insurance. A detailed comparison exercise showed that as many as 23 per cent of motorists do not accurately declare their driving history to insurers, including thousands of disqualified drivers, who had bought insurance in an attempt to evade detection.
The system will work by drivers using their driving licence number when they apply for insurance. An automatic check will be made to the DVLA database, bringing back accurate information on licences.
Nick Starling, Director of General Insurance at the Association of British Insurers, said: “This is a significant step forward in the fight against insurance fraud. We know that up to a quarter of motorists with driving offences, including disqualification, either do not declare them, or declare something less significant. This unfair to safer, honest motorists, and increases their premiums.
“Being able to access to the DVLA database will not only root out fraud, but also make the process of applying for insurance faster, produce more accurate premiums, and reduce disputes in the event of claims.”
In more detail, despite a fall in the number of road accidents, whiplash claims have risen by a third in the last three years, the ABI reports. The fact that whiplash is virtually impossible to disprove makes it an easy fraud to do,conference organisers add, particularly when ‘victims’ are often aided and abetted by ambulance-chasing lawyers and claims management firms. The Government’s civil litigation reforms will reduce the scope for ‘have a go’ claims, but further radical action is required it is claimed to get a grip on fraudulent whiplash.
In an afternoon breakout session, delegates will discuss how legislative and regulatory changes can complement other measures to help insurers win against motor fraud. The session will also explore how changes may inadvertently hinder insurers’ legitimate efforts to combat fraud if they are not applied proportionately.
