Police warn of rise in bogus insurance claims as people turn to fraud amid cost of living pressures

The City of London Police’s Insurance Fraud Enforcement Department (IFED) is urging the public to know the risks associated with committing insurance fraud, after reported cases of opportunistic fraud from March 2022 to April 2023 rose by 61 per cent from the previous period.

Opportunistic insurance fraud occurs when somebody spots a chance in their everyday life to exaggerate a claim for financial gain, or provide false information when applying for insurance. Examples include faking an injury following a genuine road traffic accident or claiming twice on insurance after losing an item of jewellery.

Motor insurance fraud was the most common type of opportunistic fraud referred to IFED from March 2022 to April 2023, accounting for 51 per cent of the cases the unit received. Property insurance fraud was the second highest and made up 29 per cent of cases received.

With the cost of living crisis creating financial pressure for people across the country, IFED believes that increased numbers of otherwise law-abiding citizens are turning to insurance fraud as a way to ease financial hardships.

The unit has today launched a national awareness campaign to highlight examples of opportunistic fraud and the devastating consequences that committing it can have.

Detective Chief Inspector Tom Hill, from the Insurance Fraud Enforcement Department (IFED) at City of London Police, said:

“We understand that the rising cost of living has presented challenges for many people across the country – but turning to crime to make some quick cash is never the answer.

“Committing insurance fraud can leave you with a criminal record, and have long and serious consequences such as criminal prosecution and a prison sentence.

“At the very least, it can make it harder to get insurance in the future. Offenders can be placed on the Insurance Fraud Register, run by the Insurance Fraud Bureau, which can prevent them from accessing essential insurance services for several years.”

During a period of enforcement earlier this year, officers from IFED investigated 18 opportunistic claims, worth a total estimated value of £216,875, resulting in multiple search warrants, charges and arrests across the country.

Officers searched addresses in Newbury, Peterborough and Portsmouth and arrested two people, with the Crown Prosecution Service authorising charges against four other people suspected to have made fraudulent claims. Seven interviews were conducted in connection to the investigations and several 'cease and desist’ notices were delivered across the country.

Fraudulent claimants caught out during this period included:

• Collette Drysdale, 54, of The Cloisters, Dunstable, was charged with fraud by false representation after officers suspected that she submitted a personal injury claim that falsely stated she was in her car when her neighbour’s vehicle crashed into it. A date is due to be set for Drysdale’s first appearance at court.
• A 43-year-old man from south London was ordered to pay a £500 fine and a further £500 in court costs at Inner London Crown Court on 5 May 2023, after he submitted claims for the same television on two home insurance policies. He pleaded guilty to two charges of fraud by false representation at the same court on 24 March 2023.
• A 52-year-old man, from Hayling Island, Hampshire, who stayed in temporary accommodation following water damage to his home, was cautioned by IFED officers after he edited invoices from a hotel to inflate the costs shown, and then sent them to his insurance provider.

Mark Allen, Assistant Director, Head of Fraud and Financial Crime, at the Association of British Insurers, said:

“Insurers appreciate the financial pressures that many households are facing with higher cost of living bills and will pay legitimate claims as quickly as possible. But making a fraudulent insurance claim to raise some cash will lead to further financial hardship, with the only thing that you could gain a criminal record. You will find it harder and more expensive to get future insurance and other financial products. If you are worried about being able to afford your insurances, then talk to your insurer to see what support and help they may be able to provide.”

Jon Radford, Head of Intelligence, Investigations and Data Services at the Insurance Fraud Bureau (IFB), said:

"We know times are hard, but if people think turning to insurance fraud can help their financial woes go away, they can think again.

"When someone is added to our Insurance Fraud Register, they can have their access to essential insurance services denied for five years and this has devastating consequences - from being unable to insure and drive a car, to being refused buildings insurance and ultimately access to a mortgage.

"Every day we're collaborating with IFED and our insurer members to detect and disrupt fraud networks across the country, making life harder for scammers. Don't chance fraud, it's not worth the risk."