Birmingham’s status as the UK’s biggest motor fraud hotspot has been confirmed in our sixth annual Motor Fraud Index. The city ranked number one in the top ten hotspots for all types of motor fraud for the fifth consecutive year, accounting for 7.44% of all suspect motor insurance claimants across England and Wales handled by Keoghs throughout 2013. This was closely followed by East London (4.55% of all suspect motor insurance claims), Bradford (4.2%) and Manchester (4.1%), placed second, third and fourth respectively. For the first time since Keoghs started producing the fraud index in 2009, Liverpool has dropped out of the top five and has fallen to no.14 (2.04%).
As part of our ongoing work to help insurers fight fraud, we produce an annual Motor Fraud Index. Increasingly seen as a benchmark for the industry, the Index provides in-depth analysis of all suspicious motor insurance claims that have been presented to the firm for resolution in the past year, grouped by the address of the claimant. As well as being the overall UK hotspot, Birmingham also ranked first for all forms of organised or opportunistic motor fraud including fraud ring claims, induced collisions and bogus passenger claims.
For the first time for several years, the majority of claimants registered were linked to fraud rings (34.37%) with Birmingham accounting for 7.28% of these.Amongst the top 20 towns on the Index, those experiencing the highest annual increase in suspect claimants were Slough, which saw a 46.5% rise; Blackburn (16.6%), Ilford (16%) and Twickenham (22.8%). Regionally, despite a fall in the number of suspect claimants in some cities such as Liverpool, Chester, Crewe and Warrington, some areas in the North of England have seen large increases in the number of suspect claimants. This includes the Northern towns and cities of Wigan (73% increase), Halifax (46%), Bradford (17.5%) and Blackburn (16.6%). Blackburn most notably has seen a five-fold increase in the number of claimants linked to fraud rings since last year.
In Wales, Cardiff remains a fraud blackspot following a 9% rise in claimants linked to fraud rings, although areas that have traditionally been low in this type of fraud are now experiencing a rise. These include Bristol, Swansea and Newport. The 2014 Index also shows an increasing concentration in types of fraud over the course of the past three years; almost a fifth of all claimants linked to fraud rings are based in just three postcode areas – Birmingham, East London and Bradford - whilst Birmingham and East London now account for more than a tenth of all suspect claimants registered on our database.
Speaking of the findings, James Heath, Partner and Director of Counter-Fraud Strategy at Keoghs, said: “This year’s results continue a trend we have seen over the past few years; an ongoing spread of fraudulent motor claims. As in previous years, Keoghs’ Index shows that only relatively small areas of the UK are left unscathed by the problem of fake motor insurance claims. Of particular concern is the further significant growth in fraud rings and networks, showing once again that organised criminals see insurers as a key target for their insidious activities. As such we embrace the work that both the Insurance Fraud Bureau (IFB) and Insurance Fraud Department (IFED) at the City of London Police are conducting in this area, and we will continue to support and work with both organisations to stamp out organised insurance fraud.”
James added that Keoghs continues to implement a joined-up, holistic approach to the investigation of insurance fraud. He said: “The implementation of the Claims Portal and the LASPO Act has fundamentally changed the way in which personal injury claims are handled. As a consequence, much quicker decision making is required and many insurers are therefore re-evaluating their approach to tackling insurance fraud. Keoghs are committed to delivering new technologies, tools and procedures to support the insurance industry’s fight against fraud in this post-Jackson world. We will continue to work with our clients to take the fight to the fraudster, and to protect both insurer clients and their honest and genuine customers.”
Keoghs’ Counter Fraud-Services (CFS) division is the largest and one of the longest established in the market, with over 15 years’ experience of providing dedicated counter-fraud services. The firm currently handles suspect claims on behalf of insurers who underwrite around two thirds of the UK motor market.
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