The consequences of insurance fraud are not limited to the insurer that was tricked — insurance fraud affects everybody. One act of insurance fraud raises premiums for all policyholders. Whenever people profit from insurance fraud, they do so at other policyholders’ expense.
Insurance fraud has a wide variety of guises across every type of insurance, ranging from exaggerated claims to highly organised ‘crash for cash’ crime rings that plan elaborate road accidents to claim on bogus injuries.
And business is booming—more than £2 billion of undetected insurance fraud is committed every year, according to the Association of British Insurers (ABI).
To help battle this illicit industry, the ABI, in partnership with the Insurance Fraud Bureau, introduced the Insurance Fraud Register (IFR), the first industry-wide database of known insurance fraudsters. It will contain the identities of individuals who have been detected acting fraudulently towards insurers, whether in the process of applying for or renewing insurance cover, or when making a claim. Both policyholders and third parties will be loaded onto the IFR, as will suppliers and other professional enablers who have acted fraudulently.
Scheduled to be made available in mid-2014, the IFR will initially be open only to ABI members, and in the future will be extended to other appropriate industry stakeholders.
The IFR aims to protect honest insurance customers by accomplishing the following:
• Making it difficult for insurance fraudsters to engage in criminal activity
• Facilitating enforcement agencies’ detection and identification of fraudsters
• Keeping the cost of insurance premiums down for honest customers
Bollington Insurance Brokers is committed to helping prevent fraud and keeping your costs down. Stay up to date on fraud news by visiting www.theifr.org.uk.