The Association of British Insurers (ABI) state that 24,000 claims worth £260m were found to be dishonest in 2008. Bogus and inflated insurance claims are estimated to cost the UK insurance industry over £1.6 billion a year and this can add around £40 to every policyholder’s premium.

We tend to divide fraudulent accident claims into three separate areas; exaggerated claims, staged accidents, and non-existent accidents.

Exaggerated Claims

In an exaggerated claim, the policy holder has sustained a genuine accident but has then exacerbated the damage to their vehicle.  The reasons behind this include the owner wanting to increase the repair costs enough so that the vehicle is considered a total loss to escape from finance deals if they are unable to sell the vehicle, if there are expensive mechanical problems or even so that they can simply buy a new car.  If the damage is light then it is sometimes exaggerated so that a personal injury claim can be brought about.  It may be that they want scruffy or faded paintwork included in the repair.

In these situations the assessor must identify all areas of damage consistent with not only the colliding vehicle but also the accident circumstances.  The positioning of the damage is carefully measured and compared to that of the other vehicle, as is the depth of the crushed parts in order to consider the magnitude of the impact.  The assessor will also examine the directly contacted areas for material transfer off the colliding vehicle.  The profile of the damage is then considered to identify any inconsistencies. 

We have often found damage sustained to both vehicles being consistent but then additional damage has occurred to one.  Common inconsistencies include damage being higher or lower than the colliding vehicle’s damaged area or in some cases any part of the vehicle.  We see many vehicles with narrow, vertical impacts from bollards or posts, and we often find traces of brick dust where a vehicle has been deliberately driven into a wall.

Although the claim starts of genuinely, the greediness of the policyholder leads to the entire claim being voided and in some cases criminal proceedings.

Staged Accidents

Staged accidents tend to fall into two categories: Firstly the policyholder may deliberately crash his vehicle into a friend or even other member of a fraud ring in order to bring about a claim for hire cars, personal injury, storage charges, recovery charges, and other costs.  As these vehicles have collided the damage sustained to the two vehicles may initially appear consistent with each other.  However, the damage may not be consistent with the accident circumstances.  For example it may be claimed that a third party pulled out of a side street into the side of the policyholders vehicle, yet the damage shows no grazing or rearward movement of the parts on the policyholder’s vehicle and no lateral movement on the third party vehicle demonstrating that the policyholder’s vehicle was stationary when they collided. We often see vehicles hit in the side, but because the ignition was off the side air bags did not deploy demonstrating that the vehicle was not in use when hit. 

The second type of staged accident sees the driver deliberately driving their vehicle in such a way that forces an innocent motorist into a collision which is seen to be their fault.  A common example is a policy holder will pull in front of a vehicle and slam on their brakes forcing the innocent motorist to collide with the rear which is typically seen as the innocent motorists’ fault.  Fraudsters tend to target commercial vehicles as there is a high chance that they will be insured comprehensively and also that the commercial driver will not be as keen to defend a claim off their employers’ policy.

We will often visit the locus to ascertain whether the accident could have occurred as described, whether drivers or witnesses would have been able to see the view described and whether there is any evidence of the accident left at the scene.

Non-Existent Accidents

One of the easier frauds to detect using the techniques described above, where the two vehicles have damage but not from a collision between each other.  It may be that a policy holder has a genuine accident which is their fault.  They then decide to involve a third party, deliberately damaging that vehicle and alleging that the two vehicles collided.  Other cases have involved cars being damaged due to catastrophic engine failure; rather than pay out for costly repairs, an alternative vehicle is crashed into the faulty vehicle.  For this reason we will check the condition of the engine and if possible start and run the vehicle.

Investigations

To supplement our investigations we utilise databases such as HPI to check the vehicle’s identification details, finance history, total loss markers and various other data, MIAFTR (The Motor Insurance Anti-Fraud and Theft Register), the DVLA (The Driver and Vehicle Licensing Agency) and Netfoil (one of the largest globally linked relational databases, employing sophisticated i2 software which is used by the intelligence community, law enforcement agencies and insurers in the UK and internationally.  Netfoil holds data relating to over 20 million claims.

Vehicles often ‘disappear’ before an assessor can view the damage, so we utilise cold calling and covert examinations where necessary.  This is often the case where organised fraud rings are habitually crashing cars and raising claims often cross-hiring vehicles but hiding the vehicles until the claim is settled.  We have also found some fraud rings using vehicles previously written off but not recorded and claiming the damage is as a result of another accident.  In these cases we examine the corrosion to assist in aging the damage.

One claims company asked us to inspect a vehicle and provide a standard accident damage report, but when we arrived at their yard our assessor was asked to wait outside for approximately ten minutes.  When eventually let into the yard and shown to the car, our assessor noted a fairly heavy rear end impact to a small hatchback car.  Whilst noting details of the damage he heard a slight tinkling noise and saw that tiny shards of glass were periodically falling from the remnants of the rear screen.  It was clear that the ‘accident’ had occurred whilst the assessor had been waiting outside the yard.

Insurance Fraud Bureau (IFB),suggest that their evidence shows that the proceeds from this type of fraud are used to fund other forms of serious and organised criminal activity.

In the below photograph, one can see examples of exaggerated damage; there are differing directions of damage sustained to this vehicle which simply does not occur during a collision.  One can also see a puncture mark near the mirror, which turned out to be an identical match with a jaw of a nearby digger.  The quarter panel has also been pushed inwards as the attempts of damage in the lower regions would not warrant a new panel.

In this case we were instrumental in not only ensuring that the claim was repudiated but assisted in the criminal proceedings brought against the policy holders.

With fraud becoming prolific from the otherwise candid policyholder exaggerating claims to specific organised criminals inciting multiple bogus claims, we are keen to use our knowledge, investigative and examination skills coupled with vast databases to help insurers fight the very root of fraudulent claims.