By: 23 June 2023
IFED: Cost of living pressures cause opportunistic fraud figures to more than double

The City of London Police’s Insurance Fraud Enforcement Department (IFED) is urging the public to know the risks associated with committing insurance fraud. 

Reported cases of opportunistic fraud from March 2022 to April 2023 rose by 61% from the previous period.  

IFED defines opportunistic insurance fraud as a person spotting 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% of the cases the unit received. Property insurance fraud was the second highest and made up 29%.  

Because of the rising cost of living, IFED believes that increased numbers of otherwise law-abiding citizens are turning to insurance fraud to ease financial hardship. 

In response, the unit has launched a national awareness campaign to highlight examples of opportunistic fraud and their potential devastating consequences. 

Detective Chief Inspector Tom Hill, from IFED at the City of London Police, advised against committing insurance fraud in times of financial hardship.  

He 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.”  

Mark Allen, assistant director and head of fraud and financial crime at the Association of British Insurers, warned of the consequences of committing insurance fraud. 

He said: “Insurers appreciate the financial pressures that households face with the increased 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 you could gain is 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 insurance, 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), also 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.”

Image: © Berezko via Canva
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