Fraud cases in 2022 driven by motor insurance scams

Motor insurance made up the largest volume of fraud cases in 2022, new figures from the ABI have revealed.

Data published yesterday (23 August 2023) showed some 42,500 motor scams were uncovered last year, representing 59% of total insurance claims fraud.  

The ABI highlighted that one case involved a London man who stood to pocket £50,000 by acting as a ghost broker and selling fake motor insurance.    

Detective chief inspector Tom Hill, from the City of London Police’s Insurance Fraud Enforcement Department (Ifed), said: “Insurance fraud is never simply taking money from a company that can afford it.

”Many victims of insurance fraud are members of the public, from people who have their identities stolen to help facilitate fraud, to people who have unknowingly bought fake motor insurance from ghost brokers.

“Both Ifed and the insurance industry cannot afford to take our foot off the pedal when it comes to uncovering and disrupting fraudsters.”  

’Cracking down’

The ABI also revealed that the value of an average insurance scam in 2022 increased to £15,000, up 20% on 2021.  

The figure reflected a rise in the value of property frauds, which rose to £134m, up 8% year-on-year.

This was despite the number fraudulent claims detected last year falling by 19% on 2021 to 72,600 cases – of these, the number of opportunistic frauds decreased by 18% to 63,000.

The ABI warned that while the industry’s warnings about the ”grave consequences of committing fraud may be deterring some people”, there will be “no let-up in cracking down on insurance fraud”.

Mark Allen, ABI assistant director and head of fraud and financial crime, said: ”With many households and businesses continuing to face rising costs, now more than ever honest customers expect insurers to weed out the cheats and focus on paying genuine claims as quickly as possible.   

“Fraud is now the most reported crime in England and Wales. As financial hardship increases, previously honest customers could be tempted to act in the moment to exaggerate claims.

”These latest figures highlight that some fraudsters are aiming big, with some large frauds uncovered.

”This shows why there can be absolutely no let-up in pursuing insurance fraudsters. Honest customers rightly expect nothing less. It is also important that consumers remain vigilant to potential scams.

”The golden rule is never act in haste – if a deal appears too good to be true, then it probably is.”