Vehicle insurance fraud costing millions each week

According to recently released figures motor insurance fraud is now costing around £5 million a week, with the number of fraudulent claims having risen by a massive 70% in the space of three years. Last year the insurance industry uncovered around 24,000 fraudulent claims that were valued at £260 million, equating to £5 million a week.

The information came from the Association of British Insurers, and according to officials from the group these fraudulent activities are costing honest drivers around £40 a year more in premiums to cover the cost of fraud in this sector. On top of this there is the cost of tackling insurance fraud, but the ABI did not put any figure on this.

An official from the ABI said: “Insurance fraud is no victimless crime. Honest motorists pay through higher insurance premiums. 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.”

Fraudulent car insurance claims have become a massive problems for the industry, and in 2006 the Insurance Fraud Bureau was set up to tackle accidents that are staged in order to claim on insurance.