Zurich Municipal warns local authorities to strengthen fraud defences

1st May 2003

Local authorities are in danger of becoming a soft target for fraudsters if defences are not reinforced, warns Zurich Municipal.  The problem is already diverting resources away from frontline services.

Speaking at the ALARM Combating Fraud Seminar in Bolton today (May 1), Zurich Municipal’s Fraud Liaison Manager, Glen Marr highlighted developing tactics across the insurance industry to limit the growing impact of fraud.

Measures include:

• Adopting a clearly documented anti-claims fraud strategy
• Putting in place a dedicated claims fraud investigation team
• Regualrly rolling out claims fraud training so that all staff are aware of the warning signs and the steps needed to effectively tackle the problem
• Sharing electronic data

In October 2002, the Association of British Insurers (ABI) commissioned independent public opinion research to assess attitudes to making fraudulent insurance claims. Almost 50% of people admitted that they would not rule out making a fraudulent claim. Exaggerating an insurance claim was seen to be acceptable to 40% of people.

Glen said; "We must not overlook the fact that a fraudulent claim, whether made up or exaggerated, is a crime."

"With the number of fraudulent claims on the increase, and stiffer anti-claims fraud defences being put in place by insurers, fraudsters will always seek the softest targets and this, unfortunately, could be local authorities. Insurance fraud is costing the taxpayer money and taking resources away from vital frontline services.  The problem will only snowball if not tackled straight away – it will not melt away on its own."

-Ends-

Notes to Editors:

• Zurich Municipal is the leading provider of risk management and insurance solutions to Britain's public services. The company employs nearly 600 staff dedicated to providing expert advice and support to public service providers. For further information visit www.zurichmunicipal.com
• ALARM, the Association of Local Authority Risk managers, represents more than 1400 members across the UK public sector. It aims to enable public sector organisations to develope and implement successful Risk Management practice, to promote education and training and to disseminate information.
• Zurich Municipal reached its 10th anniversary in March 2003 - a month that also marked the 100th anniversary of Zurich Municipal's predecessor organisation - Municipal Mutual Insurance
• Zurich Municipal is part of Zurich Financial Services, an insurance-based financial services provider with an international network that focuses its activities on its key markets of North America, the United Kingdom and Continental Europe. Founded in 1872, Zurich is headquartered in Zurich, Switzerland. It has offices in approximately 60 countries and employs about 68,000 people

For further information please contact:
Pritie Billimoria, Helen Cherns, Catherins Webster or Robert Blevin
Tel: 020 7535 9950