What's the future of metal theft?

The insurance sector is facing mixed news about the future of metal theft at the moment.

On the one hand, Ecclesiastical has released promising new figures showing that the cost and frequency of metal theft claims decreased significantly last year – good news, particularly if other insurers have experienced the same.

Obtaining comparable statistics on the cost of metal theft to insurers is difficult, but one firm that has experienced a different picture to Ecclesiastical’s is Zurich. The insurer announced in November 2012 that a spike in metal theft from empty properties had led to a 2,500% increase in the cost of these types of insurance claims since 2004.

However individual insurers have been affected by metal theft claims, they face the universal problem that the dedicated metal theft police force, the National Metal Theft Taskforce, might soon run out of cash.

The police unit is funded by a £5m grant from the Home Office, but this will run out in March, and a replacement has not been agreed.

If the government does not extend the funding, the future of the unit may depend on private funding, as is the case with the Insurance Fraud Enforcement Department.

In this event, insurers can expect to pick up part of the bill. However, as the work of the metal theft unit benefits other sectors than insurance, the cost could be shared across other industries.

The future of metal theft will also be affected by the Scrap Metal Dealers Bill, which is going through parliament. This provides for compulsory licensing for scrap metal dealers and for heavy fines for transgressions, and gives the police and local authorities greater enforcement powers.

The future of metal theft is still uncertain, but hopefully a renewed police unit and new legislation will give insurers some solace in 2013.