IFB slams ABI's U-turn on anti-fraud adverts

The ABI has come under fire from the chairman of the Insurance Fraud Bureau (IFB) for its decision to shelve its anti-fraud advertising campaign.

John Beadle described the move to scrap the long-awaiting media campaign as "disappointing".

He said that the insurance industry needed to do more to raise awareness of fraud.

"The media is a powerful tool," Beadle told Insurance Times. "Unfortunately there is only a finite amount of funding available, and individual companies don't tend to advertise their anti-fraud measures."

Insurance Times reported (News 29 March) that the ABI had decided to abandon plans for an industry funded anti-fraud campaign in order to work alongside the FSA in raising awareness of the cost of insurance fraud.

Beadle's comments came as a survey revealed that consumers are generally unaware of the industry's efforts to combat fraud, and remain overwhelmingly unlikely to report it.

The poll, commissioned by Experian, revealed that only 15% of consumers believed the industry was doing enough to guard against fraud, while over half admitted they did not know if the industry was doing anything at all.

In a potential blow to the success of the Cheatline initiative, which forms a central plank of the bureau's anti-fraud strategy, the survey also found that 86% of people would be unwilling to report a fraud-related offence.

Beadle insisted, however, that there was room for optimism, saying that Cheatline had received over 350 calls since August last year.

"Providing safeguards are in place, people have proven increasingly willing to report fraud. We would like to utilise this growth."

But he stressed that ongoing concerns over anonymity and corroborating evidence continued to deter some people from acting.

David Murby, managing director of Experian's Insurance Services division, said: "People see insurance fraud as a crime against an organisation rather than an individual and, as a result, appear less likely to report it."

The survey also revealed that more than nine out of ten people believe that insurance fraud is a serious offence, while one fifth believe that everyone exaggerates when making a claim.

The sophistication of fraudsters is also on the increase, the survey said.

Murby added: "Insurance fraud is evolving, and there has been a significant upsurge in organised fraudulent activity contributing to higher premiums and greater pressures on the insurer-customer relationship".

Fraud adds an average of 5% to insurance premiums.