Insurance fraud cases could spike in the current tough economic climate, a new “stop the scams” campaign warns.
The insurance industry has launched the campaign to help people spot the warning signs of scams and report them to the Insurance Fraud Bureau (IFB).
Those behind the campaign said bogus insurance claims jumped back in 2008, as the previous economic crisis unfolded.
There are concerns that the current difficult economy, with many people having lost money, could also push the numbers up.
With Covid-19 causing so many people to lose out financially, it sadly means there are more opportunities for insurance scammers to exploit the vulnerableBen Fletcher, IFB
At least one insurance scam takes place every minute in the UK, the IFB said.
The IFB, along with the Association of British Insurers (ABI) and the City of London Police Insurance Fraud Enforcement Department (IFED), have launched the new campaign, which will involve animated scam warnings being rolled out across social media.
Common scams highlighted by the campaign include:
– Compensation scams
This is when a fraudster or unscrupulous firm contacts someone out of the blue to tell them they may be entitled to compensation. Victims hand over personal details which can be used to steal their identity or bank funds, or they could be encouraged to take out a fraudulent insurance claim.
With many people having lost money due to the impacts of the coronavirus pandemic, scammers may well use this to offer to recover financial losses.
– Ghost brokers
Fraudsters pose as insurance providers and offer unrealistically cheap insurance deals, such as fake car insurance, on social media.
With Covid-19 impacting so many people’s work and travel plans, ghost brokers could also offer deals that claim to compensate for any further disruption.
The IFB has seen a jump in investigations into ghost brokers in recent years.
– Crash for cash
Criminals deliberately cause a motor accident, sometimes by slamming their brakes on when another car is close behind, so they can claim compensation from the motorist who hits their vehicle.
One in every 10 injury claims for a motor collision is linked to a suspected crash for cash, the IFB said.
Ben Fletcher, director of the IFB, said: “With Covid-19 causing so many people to lose out financially, it sadly means there are more opportunities for insurance scammers to exploit the vulnerable. These fraudsters don’t care who suffers – from the elderly to key workers, we’ve seen them get targeted.
“It’s never been more important to raise public awareness of insurance fraud, which is why we’re launching the stop the scams campaign. If anyone sees something that doesn’t look right, they should report it to the IFB Cheatline.”
Mark Allen, fraud and financial crime manager at ABI, said: “Insurance fraud is no victimless crime.
“While the coronavirus crisis has led to financial hardship for many, no-one should think that committing an insurance fraud is a path to easy money.
The consequences of committing fraud will be severe and long-lastingMark Allen, Association of British Insurers
“From getting a criminal record and possibly a jail sentence, to finding future insurance and other vital financial products like mortgages and loans much harder to obtain and more expensive, the consequences of committing fraud will be severe and long-lasting.
“The industry makes no apology for its relentless pursuit of insurance cheats to protect genuine customers who end up footing the bill through their insurance premiums.”
Detective Superintendent Peter Ratcliffe, head of the City of London Police’s Economic Crime Funded Units, said: “Our industry partners provide us with valuable intelligence to help us identify suspected fraudsters and carry out this enforcement activity, but we also rely on information from the public.
“As such, it’s vital people report to IFB’s Cheatline when they have information about a suspected insurance fraud or fraudster.”
Evidence of an insurance scam can be reported to the IFB’s confidential Cheatline on 0800 422 0421 or by going online.
The IFB uses information from Cheatline reports to work with insurers, the police and industry watchdogs.
The stop the scams campaign is being featured on the IFB homepage at: https://www.insurancefraudbureau.org/