Fraudulent property insurance claims almost double in just two years

As the UK continues to grapple with the cost-of-living and high interest rates, new data released today from Zurich UK shows that in the last two years alone, fraudulent property insurance claims are a hot spot for fraudsters soaring by 88¹% . Whilst the volume of claims has almost doubled, the average claim per fraudster is £19,058². As the insurer strives to keep pace with increasingly sophisticated fraudulent activity to protect the honest customer, detecting these property claims has saved £15.5 million in the last year.

Across the business, the data reveals that in the last year alone, a total of £78.5million worth of fraud was uncovered in bogus claims. This is an extra 12% (£8million) saved from fraudsters compared to 2022, equating to £215,117 a day³.

More than double the number of property claims were investigated in December compared to the previous year, according to Zurich⁴. Overall, 906 property claims were referred for investigation in 2023, a 44% increase from 2022⁵.

YouGov findings published by the Insurance Fraud Bureau (IFB) suggest a growing number of young adults could turn to insurance fraud as the cost-of-living crisis deepens. According to the findings, one in four young adults now say they would ‘likely’ consider an act of insurance fraud if they were struggling financially, a marked increase when compared to the same survey last year. The 2023 survey found that if struggling financially, over one in four, (27%) 18–24-year-olds would think about lying on an insurance application to save money, this was previously just one in five (21%) in 2022⁶.

Zurich continues to invest and adapt in order to combat the latest trends in fraud by using sophisticated data analytics to identify fraud patterns and networks. For instance, Zurich uses a data system, Carpe Data, which screens personal injury claims against the internet for any sign of suspicious activity. Alongside this, various investigative tools are utilised to assist with the investigation and validation of claims.

Scott Clayton, Head of Claims Fraud at Zurich, said: “It’s clear that every year fraudsters are becoming more sophisticated, sometimes executed by highly organised criminal gangs. Whilst there isn’t a silver bullet, it’s important for every insurer to keep pace by using the latest detection technology, alongside human intervention, in order to combat fraud and protect the honest customer.”

Detective Chief Inspector Tom Hill, from the City of London Police’s Insurance Fraud Enforcement Department (IFED), said: “As food, energy and fuel bills remain high, we understand that exaggerating or fabricating a property insurance claim can seem like a quick way to make money.

“But pursuing a fraudulent insurance claim has very real consequences. It can make it harder to secure insurance in the future, and even result in a criminal conviction.

“Insurance fraud pushes up the cost of premiums for everyone, which means that honest customers end up paying the price. We're continuing to work closely with the insurance industry to help root out fraud, and welcome Zurich’s work to detect fraudulent claims.”

Case studies:

Time’s up! A man who claimed his £7,800 Rolex Wimbledon watch was stolen during an armed robbery was investigated after providing conflicting information to both Zurich and the police.

When asked how he paid for the Rolex, the fraudster provided various handwritten sales invoices for second hand vehicles. Industry-wide searches discovered that all the invoices had been faked, and the policy was terminated.

A gift fit for a King - A fraudster with an eye for the finer things in life claimed that a Royal Crown Derby collection of fine bone china worth £50,000 had been stolen in a burglary.

Receipts from a gift shop were presented as evidence but on inspection were discovered to be fake. The police then concluded that the burglary had been staged. Zurich declined the claim, the policy was terminated, and the fraudster was registered on the Insurance Fraud Register. The matter currently sits with the Public Prosecution Service.

On your bike! A policyholder who works at a London insurer claimed £300 for stolen bike wheels. He supplied a photograph showing the bike without its wheels, however on closer inspection the photo predated the policy. When challenged he admitted to lying and was added to the Insurance Fraud Register.

¹Zurich UK Fraud data analysis 2021-2023 – 482-906 property fraud claims detected.

²Zurich UK Fraud data analysis 2023- total property savings of £15,456,116 delivered in 2023 across 811 claims. This represents an average saving of £19,058 per property investigation.

³Zurich UK Fraud data analysis 2023 - £78,517,682. £70m in 2022- £78.5m in 2023

⁴Zurich UK data analysis 2022-2023 57-123 claims

⁵Zurich UK Fraud data analysis 2022-2023 – 631 to 906 claims

⁶YouGov findings published by the Insurance Fraud Bureau - New YouGov findings show growing number of young adults tempted by insurance fraud | (insurancefraudbureau.org)