Sunday, February 12, 2012

Insurance Fraud Rises Due To Down Economy

According to a survey done by insurance firm, AXA, the discouraging global economy is causing many to report less than truthful insurance claims from policy holders in an effort to get some extra cash.

Exaggerated insurance claims is nothing new to the industry and many firms have parameters already in place to detect such attempts. Thus, it is alarming that many people are still resorting to the act.

In 2011, the Association of British Insurers reported that fraudulent claims went up by as much as 10% - which amounts to around 1,000 U.S. dollars additional claims. Such acts typically includes insurance claims for non-existent jewelry, gadgets and other expensive goods.

"It's not a victimless crime, honest customers end up footing the bill through higher premiums," claims Steve Gaywood, head of fraud investigation in Axa. He further warns, "If consumers get caught out they run the risk of having the whole claim turned down as well as facing problems getting insurance in the future."

Statistically surprising also is the company's report that from the past six years, casualties to road accidents have dramatically decreased by 23%. However, the claims for motor insurance injuries have risen to as much as 70% - most of which are claims for the favorite, whiplash injury.