Keoghs Insight


Stuart Hunt

Combatting Fraud

Property Insurance Aware 2

There is a wealth of evidential sources which have been utilised in the fight against motor fraud. Expert engineering reports, electoral roll searches, credit histories, CUE and MIAFTR searches, even the use of social networking. In contrast, establishing that a first party claim made under a buildings or contents policy is fraudulent or has been deliberately exaggerated, is often much more difficult to prove. Identifying tangible and independent evidence of fraud in household and commercial property claims can be extremely challenging.

If insurers choose to investigate a potentially fraudulent claim, then those investigations should exhaust the resources available which include communications between solicitors, insurers and loss adjusters in order to consider the claim in the round. We set out below recent examples of cases we have been involved with which have led to the successful repudiation of a claim on the grounds of fraud or deliberate exaggeration where we had to think outside the box to see the back of a claim.

Case Study A

The insured (Mr. A) reported a claim to his insurer (B) following an alleged burglary at his property. As the claim progressed however, it became clear that there were several concerns. As part of the investigations, the circumstances and logistics of the alleged burglary were considered in conjunction with a list, provided by Mr A, of the items allegedly stolen. Mr A acknowledged that the alleged burglars did not have vehicular access to his property and must have approached and escaped on foot.

Despite the obvious restrictions imposed on the alleged perpetrators, Mr A claimed that two games consoles and over 20 console games, a DVD recorder, a laptop, five large screen TV’s (four of which were 37” inches or greater) and £2,500.00 in sterling and foreign currency had been stolen. Common sense indicated that, either the list of items allegedly stolen was deliberately exaggerated in order to obtain an inflated settlement or the burglary had never taken place. Further investigations also revealed that all of the console games allegedly stolen had not been released at the time of the burglary. Indeed, some of them had still not been released by the time Mr A presented the claim and list to B. The information uncovered above was used in conjunction with other evidence to successfully repudiate the claim in full.

Case Study B

Miss B reported a claim to her insurer (X) following an alleged burglary at her home. Her policy with X provided cover for £40,000 worth of contents, with an additional £15,000 for valuables. The circumstances of the burglary however, were questionable. Miss B claimed that a small glass panel missing from the locked front door was the point of entry for the thieves. Despite this, it was alleged a significant amount of jewellery had been stolen from the property, along with several high value electronic household items, including an Apple Mac and two large televisions. Miss B claimed to have no receipts for the jewellery, stating the pieces were gifts, although she provided images taken on her iPhone which she claimed showed the full extent of the jewellery stolen.

When asked where she had obtained the funds to purchase the high value electrical items, she claimed that she had sold a motor vehicle to an associate, Mrs D. A jewellery expert assessed the value of the lost jewellery at approximately £80,000. Miss B expressed an intention to claim for the full sum. The contents and valuables were therefore grossly underinsured. The policy could not be avoided and the decision was taken to explore the claim further through interrogating the metadata of the images of the jewellery. Miss B claimed that the images were taken in the same place shortly after inception of her policy with X.

However, the GPS location data embedded within the iPhone images showed that they were taken at three separate locations over a period of three months, several of them just three weeks before the burglary. The expert evidence confirmed that the GPS data encoded within the images could not have been altered in any way. The GPS data showed that the most recent images were taken at the home address of the associate, Mrs D. When interviewed, Mrs D denied that she had purchased the vehicle from Miss B, instead producing documentation showing that she had been the registered keeper of the vehicle for a substantial period of time.

To add insult to injury for Miss B, when Mrs D was shown the images and asked to confirm whether she had seen Miss B wearing any of the items of jewellery, Mrs D confirmed that many of the images depicted jewellery that she owned, and which she was able to produce for inspection, along with receipts. Mrs D also confirmed that Miss B had asked to take pictures of her jewellery in the weeks preceding the alleged burglary, which was consistent with the GPS location data. On the basis of this information obtained, the claim was successfully repudiated.

Case Study C

Mrs C made a claim under her home contents insurance policy with Y for the loss of a diamond engagement ring. The ring was a specified item on the policy. She claimed that it had fallen from her finger when removing a glove. The loss was reported to the police as required under the policy. Mrs C requested a cash settlement for the full value of the ring as opposed to a replacement, which rang alarm bells. They rang louder when initial investigations revealed that Mrs C had increased the value of the ring as a specified item from £12,000 to £20,000 at the last policy renewal (without explanation) just five weeks before the alleged loss.

In support of the claim, two invoices presented by Mrs C indicated that the ring cost £15,000 in 2001. However, investigations revealed that the diamond certificate number did not match the description of the diamond listed on the purchase invoice. In light of this evidence, concerns were expressed about the validity of the invoices, and the matter was referred to a handwriting and document expert. The expert concluded that the diamond certificate number on the invoice had been altered and that the ‘1’ in the purchase price of £15,000 had also been added in the same pen, thereby indicating that the invoice had originally identified a different certificate number and a significantly lower purchase price of £5,000.

A jewellery expert confirmed that the actual diamond ring would have cost approximately £5,000 in 2001 thereby giving significant weight to the argument that the claim was exaggerated. All that was needed was the confirmation from the jeweller who sold the ring in 2001 that the receipts and certificate had been amended after the point of sale. With our intervention, and at the second time of asking, when presented with the overwhelming evidence of fraud on the part of Mrs C, the jeweller confirmed that the amendments were inconsistent with his method of completing invoices. In his view the receipt had been amended some time after the point of sale. The claim was successfully repudiated.


If experience has taught us anything, it is that fraudulent policyholders are often their own worst enemies. Push hard enough and cracks will emerge.Of course, there are occasions when the fraud may not be uncovered, but by and large, we tend to find that where there are strong indications of fraud, if you investigate thoroughly and explore all avenues, you will tend to find the silver bullet to undermine the claim and the fraud. We cannot overemphasise the importance of effective communication between insurers, loss adjusters, investigators (forensic or otherwise) and solicitors. Case Study C is particularly indicative of this point.