£1.1bn-worth of bogus insurance claims detected last year

Some £1.1 billion-worth of fraudulent insurance claims were detected last year, marking a 4% increase compared with 2022, according to the Association of British Insurers (ABI).

About 230 fraudulent insurance claims are being detected per day, typically.

Insurers identified 84,400 fraudulent claims in 2023, which was 11,800 more than the previous year.

The average value of a bogus claim was £13,000.

Last year saw about 25,700 claims, totalling £407 million, involved losses being exaggerated.

More than half (54%) of detected bogus claims last year involved motor insurance.

Insurers uncovered 45,800 motor scams, worth £501 million in total.

Insurers also identified £143 million-worth of fake property insurance claims.

Alongside this, insurers prevented an estimated 583,000 fraudulent insurance applications, a 17% increase from 2022. Application fraud happens when information is deliberately misrepresented or hidden for financial gain.

Mark Allen, the ABI’s assistant director, head of fraud and financial crime, said: “Insurance is there to protect people and businesses should the worst happen.

“It’s encouraging to see that the industry’s efforts to detect and prevent people from abusing this are working, but there can be no let-up in pursuing insurance fraudsters.

“Fraud doesn’t just impact victims that fall foul of the scammers, it affects everyone that pays for an insurance policy – with bogus claims pushing up the cost of premiums for all. That’s why cracking down on fraud continues to be a top priority for our industry.”

Ursula Jallow, director at the Insurance Fraud Bureau (IFB), said: “We’re collaborating closely with insurers, law enforcement agencies and industry bodies to ensure that we protect the UK public from insurance fraud and scams as these can be devastating; financially, socially and psychologically.

“We urge anyone with evidence of an insurance scam to report it to our confidential CheatLine.”

Detective Chief Inspector Tom Hill, from the City of London Police’s insurance fraud enforcement department (IFED), said: “Insurance fraud is not a victimless crime. It increases the cost of premiums for honest customers, while fraudsters who sell fake car insurance or deliberately cause road traffic collisions to claim compensation put innocent motorists at risk.

“The figures released today show that around 230 fraudulent insurance claims are detected on average each day, showing that IFED and the insurance industry will root out fraudsters and bring them to justice.”