How joined-up is our industry when it comes to supporting victims of fraud and what are we doing collectively to support them? Here NFU Mutual's David Phillips discusses these questions and more.
It’s not all about the money.
When talking about fraud, the insurance industry strives to convey the huge impact fraud has on insurers, the economy and ultimately the premiums of genuine and loyal insurance customers.
All policyholders will be the indirect victims of insurance fraud which they end up paying for through increased premiums. But some insurance customers will be direct victims themselves. They may, for example, be targeted in a cash for crash scam or by other types of insurance fraud, where the fraudsters will seek to make a fraudulent application or claim using the identity or policy details of an innocent policyholder.
We rely on that policyholder to help us support the defence of the claim. But, as an industry, are we doing enough to support these victims of fraud?
In the last year I was approached by a colleague who was seeking my advice on what he could do, as his details had been stolen and were being used to run a series of fake insurance scams across a number of insurers in addition to his own. I advised him how to report it and who to contact. While he then engaged with the insurers, the whole experience left him drained and, he felt, unresolved.
It's not that he was critical of any of the firms he spoke to. They were very sympathetic to his concerns and supportive in helping him to get his case resolved. However, they were unable to help him to track down potential fraudulent policies held with other companies. The onus was left with him to sort this out.
Following some recent fraud cases I was advising on, I have also been looking at the range of stakeholders in an insurance claim, where a policyholder has been targeted by fraudsters. I am talking here about incidents like an induced motor claim, where fraudsters deliberately make an innocent driver hit their vehicle. Quite rightly investigators focus on getting the evidence right: have the investigators got all the documents and photo or CCTV footage? Have they got the witnesses on board and all their statements? Sometimes the cases are so complex that the focus on the case might lead us to forget that at the very heart of a case, is a policyholder. These policyholders don’t always understand all that is going on and can also be quite shaken up by the incident. In my eyes, they are also a victim of fraud.
I was left wondering how joined-up is our industry and what are we doing collectively to support the victims of insurance fraud?
Insurance fraud is often referred to as a victimless crime which impacts us all, friends and family alike through higher premiums. I believe it’s time that we enhanced that message. Yes, financially we might all be paying for this, but sometimes there are individuals who are particularly impacted by an insurance fraud. These are our industry customers and surely they should be at the heart of all our considerations.
There is no easy answer to these problems. I want the insurance industry to do more to help these victims of fraud. What, for example, can we learn from other sectors? What support can we offer?
We owe it to our loyal genuine customers to do more.