False insurance claims have risen by more than a quarter as desperate households risk criminal records in a bid to get extra cash amid the cost of living crisis, according to new figures.
Insurance fraudsters claimed an average of £8,800 each and most often lied about damaged or stolen jewellery, mobile phones and TVs, according to insurer Zurich.
It has reported a 27% rise in fraud so far this year after foiling £4.2million in fraudulent claims, compared to £3.3million in the same period last year.
An insurance fraudster claiming £500 has been arrested after blaming his broken TV on his daughter’s ‘before school tantrum’, despite initially claiming it happened on a Sunday.
In another case, a poker player claimed his £110,000 watch disappeared from his bag, just months after he had doubled the value it was insured for. He then insisted the coin had “appeared” in the same bag once Zurich investigators investigated the allegation.
The company’s Scott Clayton said there had been a “significant increase” in false claims since the start of the year, with households coming under increased financial pressure.
Mr Clayton said: “Unfortunately many more people are facing hardship due to the cost of living crisis which is contributing to an increase in fraudulent claims.
“The consequences can be serious and fraudsters risk criminal prosecution and potentially even a prison sentence. At the very least, offenders can expect to have more difficulty obtaining coverage in the future.
Zurich discovered a woman was lying about a £1,000 claim for a stolen bicycle, which she made just half an hour after the police bought it. Cellphone footage later revealed the thief stole the bike 45 minutes before buying the cover.
Chief Detective Inspector Tom Hill of the City of London Police said: ‘Submitting a false insurance claim may seem like a victimless crime, but it actually drives up the cost of premiums for everything the world.
“Exaggerating or fabricating a claim for an expensive watch or television may seem like a quick way to make a buck, but a conviction will have a lasting impact on your life.”
Rampant inflation, soaring energy bills and tax hikes have driven ordinary people to resort to extreme methods to supplement their incomes since late last year.
Insurer LV reported that false claims had more than doubled in the last three months of 2021, with so-called ‘prior losses’ – where someone damages or loses an uninsured item but takes out a policy and lies on dates – increased by 156% over the previous quarter.