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More than one in six consumers would consider committing insurance fraud, our research published in POST magazine showed this month.

8% of consumers admit to having made up or exaggerated a claim; a further 10% said they would consider it.

The statistics, while shocking, are also worthy of note because they expose a gulf between insurer perception and consumer reality — a topic we often talk about.


Which of the following applies to you?

I have totally made up a claim


I have exaggerated an insurance claim


Have not exaggerated a claim, but would be happy to do so


Have never made up a claim, but would be happy to do so 


I would never and have never inflated or made up a claim



According to POST, the industry believes that in the majority of cases (57%), the move to commit fraud is driven by financial stress — but only 9% of consumers we asked agreed. Instead, one in two said it was because either their insurer had previously refused their claim (16%) or they had paid premiums for years and never claimed (34%). A further 22% said insurers ‘bartering down’ a previous claim provoked a fraudulent one. CMCs encouraging fraudulent behaviour accounted for just 3% of cases, consumers said.   

52% of under 35s believe that exaggerating a claim may not be fraudulent


Why did you exaggerate or make up the claim?

Have had claims turned down unjustifiably in my view


Have paid premiums for years and never claimed


Needed the money and saw the insurer as a soft target


Inflated the claim because insurers always barter down anyway


Because a friend did


Because I was persuaded to by a Claims Management Company





Then there's the question of what fraud is. 31% of consumers — and a whopping 52% of under 35s  said that exaggerating a claim was either not fraudulent or ‘depended on the circumstances’.


The industry’s warning of serious consequences may be falling on increasingly deaf ears, with only 18% of consumers believing the publicising of fraudulent behaviour acted as a significant deterrent.


Our Chief Executive, Ian Hughes says consumer education of the economic consequences of fraud needs to happen.

“The next move by the industry should be make clear how much fraud adds to premiums. At the same time, there is work to be done to help consumers understand that exaggerated claims are not only fraudulent in themselves, but also lead to rejections.”


Four in five consumers say they expect insurers to be involved in finding solutions to the problem. But as one commentator in POST’s report explained, the debate on fraud appears to be part of a wider issue on conduct and trust. Hiscox’ head of claims, James Pilgrim-Morris said: “Do insurers do enough to ensure their products meet their customers’ needs?”


Whether we are talking about the quality of your digital claims experience, finding the pricing sweet spot to retain your customers, or solving a genuine product need, it’s the question we come back to without exception: Are we serving the customer? Fraud, it seems, is symptomatic that this is not always the case. 

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