With scams and other illegal activity continuing to rise, Allianz UK says that it has identified 33,027 instances of insurance fraud in 2024, amounting to £157.24 million in total value.
The insurer reported an average of 90 fraud cases per day, equating to £430,000 daily. The company says that this represents a 10% increase from the £142.38 million recorded in 2023.
Fraudulent activity spanned Allianz’s personal, commercial, and specialty lines, with claims fraud – where policyholders either inflate or fabricate claims – accounting for over £141 million. Application fraud, which involves providing false information when purchasing a policy, exceeded £15 million in detected cases.
The rise in fraud cases is not isolated to one insurer, either. Recently, not-for-profit insurer Ecclesiastical said that its claims specialists prevented over £4 million in fraudulent claims during 2024, an increase of nearly £1 million compared to 2023.
Ecclesiastical also reported a 37% rise in fraudulent property claims and a 17% increase in fraudulent casualty claims over the past year.
Allianz highlighted that application fraud detection continues to rise, driven by increasing incidents of policy abuse, misrepresentation, and identity theft. A notable trend is the growing number of ghost brokers involved in fraudulent policy applications, contributing to a 9% year-on-year increase in prevented fraud.
Additionally, there has been an uptick in fraudulent activity involving moped and motorcycle riders, particularly in the delivery sector, where individuals attempt to bypass the required level of cover.
Trends in motor and casualty insurance fraud include a continued rise in non-tariff injury claims, which exclude soft-tissue or whiplash-related injuries. There has also been an increase in “cash-for-crash” scams, where moped riders and couriers deliberately cause or fabricate accidents to claim insurance payouts.
Another key trend is the role of professional enablers who provide false evidence or encourage fraudulent claims. The persistence of noise-induced hearing loss scams remains a concern, with some claimants resubmitting declined claims in slightly altered forms to bypass detection.
In property insurance, fraudulent theft claims have been increasing. Commercial lines saw a 29% rise in such claims compared to the previous year.
Personal lines fraud detection has also improved, aided by the use of voice analytics, which has helped uncover opportunistic cases that might have previously gone undetected.
Ben Fletcher (pictured above), director of fraud at Allianz UK, said insurance fraud remains a significant issue, leading to higher costs for insurers and policyholders.
While most claims are legitimate, he noted that some individuals go to great lengths to submit fraudulent claims.
What are your thoughts on this story? Please feel free to share your comments below.
