ACSO Calls For Insurance Fraud Taskforce

What is the long term solution to insurance fraud? A new report calls for the government and Insurance Industry to set up an Insurance Fraud Taskforce (IFT) for the 2020s.

The Association of Consumer Support Organisations (ACSO) which represents companies that support consumers making a claim, said that, in light of the cost of living crisis, and the implementation of a number of reforms, including the small claims portal (OIC), the time is now right for new impetus on reducing insurance fraud.

ACSO executive director Matthew Maxwell Scott said: “The IFT report was published in 2016 and reviewed briefly in 2018, but there has been no industry-wide review of the report’s 26 recommendations to determine how many have been actioned and what the results have been.”

Maxwell Scott said that, more than five years on from the Taskforce, fraud still costs the industry well over £1bn annually. The ABI’s 2022 fraud report, published on 26 August, said that insurers uncovered £1.1bn of fraud in 2019. In 2016 the number was £1.3bn.

He noted: “Some of those 26 recommendations have been enacted, such as the whiplash reforms, or beefing up CMC regulation, and the Insurance Fraud Bureau (IFB) is a far more dynamic body now than five years ago.

“But some IFT recommendations have fallen by the wayside, and now that we are facing a cost of living crisis, insurers are warning that fraud may well be on the rise again.”

He pointed to recent news from Zurich that property fraud jumped by 25% in the first six months of the year, driven, it said, by increases in the cost of living.

ROADMAP

The ACSO report, which includes interviews with a number of senior claims industry executives, makes a number of industry-wide recommendations:

· Raise awareness – consumers and consumer support organisations need to be aware of the scale of fraud and the importance of being alert to how they can be victims of, and also contribute to, the incidence of fraud.

· Education and training – The digital age poses an increasingly sophisticated fraud threat. This should be reflected in how we educate children, but consumer support organisations must also consider the training they provide their staff.

· Data sharing – data should be collated, independently verified and shared across sectors. Fraud should not be a competitive differentiator between businesses.

· Improve cybersecurity – build consumer awareness of protective measures they can take to combat fraud by using appropriate cybersecurity measures such as firewalls and up-to-date anti-virus software.

· Risk management – consumer support organisations should have fraud policies which are widely understood by employees. They should also regularly review their fraud susceptibility by assessing weaknesses within their businesses and rectifying them.

· Reporting – consumer support organisations should report instances of fraud to relevant regulators to assist wider anti-fraud campaigns and strategies. Individuals should know how to report fraud to affected organisations directly as well as to the police via Action Fraud.

· Improved customer checks – consumer support organisations need to consider their initial client due diligence to assess whether there is room for improvement, for example, by using identification-checking software.

Maxwell Scott called for these and other issues should be debated through a new cross industry body and the outcomes fed into the government.

“It’s helpful that the Online Safety Bill, currently stalled pending the outcome of the Conservative leadership election, provides a legislative focus for the industry,” he said.

“In light of the increased fraud risks posed to consumers, insurers and the claims industry from the economic crisis, there is no better time to bring the industry together and agree a set of actions that all sides can work with.”

About alastair walker 10120 Articles
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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