Fake car crashes helped to push the level of car accident insurance fraud to a record £1.3bn in 2013, according to the Association of British Insurers (ABI).The figure represents an increase of 18% on the previous year for the number of false claims.The biggest rise was in car insurance accident claims. The number of dishonest motor accident claims rose by 34% to 59,900, attempting to cheat the industry out of £811m.
The ABI says the recorded level of insurance fraud is increasing because more people are reporting it and more resources are being used to fight it.The Insurance Fraud Enforcement Department, a specialist police unit, has helped to prosecute 85 people since it was established in 2011.
The industry also funds the Insurance Fraud Bureau (IFB), which was set up in 2006 to specifically tackle false motor policy claims. It is currently investigating 110 “crash for cash” car accident claim schemes across the country.
‘Blackbox’ exposes a £54,000 car insurance fraud
Three lorry passengers who exaggerated a car accident claim were rumbled by data recorded on the other driver’s telematics box. The incident involved a flatbed lorry and a Vauxhall Astra. The Astra was travelling behind the lorry in slow moving traffic and ran into the back of it, hitting its tow bar. There was no damage to the lorry and minor damage to the front of the car.
The three passengers in the lorry filed car accident claims; for personal injuries and damage totaling £54,000. However, the car was fitted with a telematics device, which feeds information to insurers about how, when, and where a car is driven including details on the driver’s speed and braking habits.
The data from the box, which is there to prove safe driving habits and reduce insurance premiums – showed that the claimed injuries were completely implausible.
Black boxes could become the norm, says IAM
Telematics-based car insurance is here to stay, says the Institute of Advanced Motoring So-called “black boxes” that record driving data) could become the norm for young drivers, according to the IAM.
Neil Greig, IAM director of policy, said: “In a couple of years young drivers may not be able to get insured without a black box.” A range of telematics-based insurance policies is now available for young drivers. A simple black box is fitted to the car, and it uses a combination of GPS and motion sensors to detect hard acceleration, braking and speed limit infringements.
They will be especially useful in analysing car accident claims, and identifying who is the non fault accident claimant.