Motor insurance fraud drives £1.1bn worth of fake claims

Motor insurance fraud was the most common type of insurance fraud in the UK last year, according to figures released by the Association of British Insurers.

It detected £1.1bn worth of fraudulent claims detected last year, which marks an increase of four per cent on 2022.

In total, insurers identified 84,400 fraudulent claims in 2023, which is 11,800 more than the previous year, with the average value of a claim reported at £13,000.

The ABI figures also include details on the type of fraud scammers attempted to commit with exaggerated loss – the deliberate attempt to increase the cost of a claim beyond its true value – the most common with 25,700 claims amounting to £407m.

Motor insurance fraud

Motor insurance remains the most common area of insurance fraud, with the ABI detecting 45,800 motor scams worth £501m, which is eight per cent more than in 2022, and 54% of all claims made throughout the year.

Mark Allen, the ABI’s assistant director, head of fraud and financial crime, said:

“Insurance is there to protect people and businesses should the worst happen. It’s encouraging to see that the industry’s efforts to detect and prevent people from abusing this are working, but there can be no let-up in pursuing insurance fraudsters.

“Fraud doesn’t just impact victims that fall foul of the scammers, it affects everyone that pays for an insurance policy – with bogus claims pushing up the cost of premiums for all. That’s why cracking down on fraud continues to be a top priority for our industry.

“Consumers also need to remain vigilant to potential scams, and our latest online fraud campaign aims to help everyone to learn how to protect themselves in an increasingly digital world. The golden rule is never act in haste – if a deal appears too good to be true, then it probably is.”