Industry News from Yes Insurance

Research from the Association of British Insurers (ABI) has shown that gangs who deliberately damage and crash cars in order to fraudulently claim compensation afterwards are costing the car insurance market over £200 million each year.

The good news is that the Insurance Fraud Bureau (IFB) has been set up to bring down organised gangs. It is estimated that 400 criminal networks are currently in operation in the UK, working to defraud insurance companies around the UK.

These criminal gangs cause shunting accidents and claim up to £30,000 in costs for damage and often fabricated medical ailments like whiplash.

False claims are part of the reason that some firms are being forced to increase their car insurance premiums.

Malcolm Tarling, spokesperson for the ABI, said: "It is a major problem for honest customers for honest innocent motorists and costs in excess of £200 million pounds a year and needs to be rooted out."

He added that the IFB, which was set up in July this year, was specifically designed to fight this problem and would look at ways to coordinate the industry to fight these criminal organised gangs more effectively.

At its launch, John Beadle, chairman of the IFB, stated: "The bureau is building powerful relationships with the police and law enforcement agencies.

"We are confident that the IFB will play an important part in protecting the honest policyholder. We will find, expose and pursue those involved in organised insurance fraud."

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