The incidence of insurance fraud in the UK is alarmingly high. An estimated £5.2 million worth of fraudulent insurance claims are processed and approved on any given day. These undetected financial losses have caused the average UK insurance policy premium to rise by £44 per month.

The Association of British Insurers (ABI) has revealed that one in five people would still consider submitting a fraudulent insurance claim despite the danger of being caught. Getting caught could result in a criminal record and struggling to obtain financial services access in the future. When the number of adults that own an insurance policy is taken into account, the magnitude of the problem becomes clearly visible. According to the ABI, more than 90% of British adults use at least one insurance product.

A recent insurance study reveals that up to 36,000 parents in the UK list their children as spouses on their car insurance:http://www.pru.co.uk/insurance_protection/car_insurance/ policies. This decreases their premiums, yet can effectively be prosecuted as fraud. TCF Corporate, a UK fraud solutions company, states that opportunistic retail fraud is the most common type of fraud. This means that individuals exaggerate actual claims to increase their payouts.

‘Crash for cash’ – the practice of causing an accident in order to claim for money – is a fairy new phenomenon, but already creating quite a problem for UK insurers. A ‘crash for cash’ scam typically involves two parties staging an accident in order to claim from their insurance providers. Centenery Way in Manchester has been highlighted as the UK’s hotspot for these types of schemes. The M65 in Lancashire is another known hotspot for this type of scam.

According to UK insurance specialist Direct Line, the claims of these scams total around £350 million every year and play a huge part in the increase of honest drivers’ car insurance premiums.

About Prudential Insurance

Prudential is a leading UK provider of affordable car insurance. Their motor insurance policies offer comprehensive protection or protection against fire, theft and third party claims. Visit http://www.pru.co.uk/insurance_protection/car_insurance/ for more information or a free car insurance quote today.

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About Prudential Insurance Prudential is a leading UK provider of affordable car insurance. Their motor insurance policies offer comprehensive protection or protection against fire, theft and third party claims. Visit http://www.pru.co.uk/insurance_protection/car_insurance/ for more information or a free car insurance quote today.