Insurers catch record number of car cheatsCar insurance fraud costs other drivers £40 a year

04 July 2008

New figures show that the number of fraudulent motor insurance claims uncovered has soared by 70% over the past three years.

The Association of British Insurers (ABI) said that last year insurers uncovered 24,000 fraudulent motor insurance claims worth £260m - or £5m every week.

Motor insurance is now the leading area for fraud, with dishonest motorists making bogus claims in a bid to make money quickly or clear debts, says the ABI.

Bogus claims

Examples of bogus claims included a woman claiming for damage to her Land Rover when it hit the front of her house.

She claimed the accident was caused by her foot slipping off the break but the damage was caused deliberately following an argument with her partner.

Another car owner – who planned to use an insurance payout to meet his hire purchase payments - claimed his car had been stolen when he had actually pushed it over a cliff.

Higher premiums

Overall, insurers uncovered 91,000 fraudulent claims on motor, household, travel and liability insurance during 2007, collectively worth £557m, with motor insurance fraud accounting for nearly half of this.

Nick Starling, the ABI’s director of general insurance and health, said: ‘Insurance fraud is no victimless crime.

£40 a year

‘Honest motorists pay through higher insurance premiums – an extra £40 a year on average. This is why insurers are ramping up their crackdown to weed out the cheats.

‘Anyone committing insurance fraud is more likely to get caught, risks a criminal record, and will find future insurance and credit harder to obtain and more expensive.’