29 January 2008
People who try to cheat the insurance system by making fraudulent claims are being cracked down on, the British Insurance Brokers' Association (BIBA) have said.
The creation of the Insurance Fraud Bureau (IFB), set up in July 2006, is seen by the association to be key to combating greater numbers of dishonest claimants.
Nevertheless, figures from uSwitch show that fraud remains a big problem within the sector.
A July 2007 study revealed that 2.5 million people could have their car insurance invalidated through failing to make full disclosure on their car insurance forms.
Around 750,000 said that they had not declared prior drink-driving episodes - and twice that number lied about basic details such as their address.
Technical and Corporate Affairs Executive at BIBA Graeme Trudgill commented: "If it's found out that someone is being fraudulent - and they will be found out because you have to really look into these claims - then questions will be asked.
"We like to think that the IFB will…reduce fraud for the sake of all the innocent customers out there."
According to figures cited by BIBA, the insurance industry loses approximately £1 billion per year through fraudulent claims.
By way of comparison, the total insurance cost of the June and July 2007 floods in southern England - one of the worst examples of extreme weather to hit the UK in a generation - is pegged at around £3 billion.
© 2008 Adfero Ltd
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