The City of London Police's Insurance Fraud Enforcement Department (IFED) is taking action against opportunistic insurance fraud as cost-of-living pressures drive a surge in such cases.
IFED investigated 18 claims across the country, amounting to a total estimated value of £216,875, in February and March 2023.
The unit executed warrants in Berkshire, Peterborough, and Portsmouth, leading to the arrest of two people and charges against four others suspected of making fraudulent claims.
Seven interviews were also conducted, and “cease and desist” notices were delivered across the country.
Unlike premeditated fraud such as “crash for cash” scams, opportunistic claims are often made by otherwise law-abiding citizens who exaggerate a legitimate situation for financial gain.
IFED attributes the increase in such fraudulent claims to the rising cost of living, as citizens seek to ease financial hardships.
Referrals for opportunistic claims received by the unit increased by 82% in 2022 from the previous year.
IFED is raising awareness of the risks associated with opportunistic insurance fraud and reminding citizens that such actions are not profitable.
The consequences of submitting a false claim can include imprisonment, a criminal record, and difficulties in obtaining insurance in the future.
IFED urged citizens to resist the temptation to commit insurance fraud and to seek legal means to ease financial burdens.
Detective Chief Inspector Tom Hill of IFED warned citizens against opportunistic insurance fraud as the cost of living continues to rise.
He said that the past year has seen a surge in fraudulent claims, with people taking advantage of legitimate situations to make bogus claims for high-value items or exploiting road traffic accidents.
Hill urged citizens to resist the temptation to engage in such activities, reminding them that the consequences could have a lasting impact on their lives.
“Fraudulent claims drive up the cost of insurance for everyone, meaning that honest policyholders end up paying the price. As well as this, making a false claim could land you with a criminal record. It may seem like a chance worth taking, but the consequences could have a lasting impact on your life,” he said.
Southampton resident Jon Morgan has been sentenced for a fraudulent claim worth over £6,000 after deliberately deflating his boat and submitting an accidental damage claim to Zurich.
Winchester Magistrates Court handed Morgan a 12-month community order and 240 hours of unpaid work after he pleaded guilty to fraud by false representation.
CCTV footage showed him bringing the boat into storage visibly intact, before deliberately damaging it.
Other fraudulent claimants caught during the same period include a woman from Bedfordshire and a man from London, both charged with fraud by false representation, and a man from Portsmouth, who was arrested for editing invoices following a genuine claim for water damage.
According to Mark Allen, head of fraud and financial crime at the Association of British Insurers (ABI), insurance companies acknowledge that many households are still struggling to cope with the cost of living, and they aim to pay genuine claims promptly.
However, customers who are honest and fair expect insurers to take strong action against insurance fraud, he said.
Allen said that anyone who suspects that someone is committing insurance fraud can make a confidential report through the CheatLine operated by the Insurance Fraud Bureau. People can access the service for free on insurancefraudbureau.org/cheatline or by calling 0800 422 0421.
