Dodgy claims; firm action

Insurers are tightening up on fraudulent claimants after the holiday season. By Nic Cicutti

It's that time of the year again. The holiday season is almost over, sunseekers return home after their two-week break - and dodgy claims for lost or stolen cameras, jewellery and designer sunglasses begin to pour into insurers' offices.

About 14 million people will have gone on holiday this summer and insurers expect an avalanche of bogus claims of about pounds 50m - more than 10 per cent of the total claimed for - to intensify during the coming weeks.

Among the more unusual claims noted by Home & Overseas Insurance, which provides cover to five million people each year, is that of the family who went on holiday to India. Unfortunately, the mother died of natural causes while out there. The family then threw her body under a taxi in order to claim under the insurers' accident policy. A post-mortem revealed that she had been dead for 24 hours before being struck by the cab.

Other cases filed away by the Association of British Insurers (ABI), the industry trade body, include:

The absent-minded individual who managed to lose a total of 33 suitcases over three years. The cases were lost on planes, trains, ferries and motorway service areas and from almost every conceivable form of transport. The one, bizarre, unifying feature of the claims was that each lost suitcase contained scuba diving gear.

A young man who attempted to finance his round-the-world trip by making false claims in most of the continents he was passing through. This hapless traveller found police waiting for him on his return.

The middle-aged woman who claimed to have left a bag with pounds 3,000-worth of jewellery on an aircraft. Unfortunately for her, within a few weeks she also reported a burglary at her home in which identical jewellery was listed as stolen.

One foreign national claimed for losing a suitcase on a UK flight. He was arrested for making a false claim, and when police searched him they found false documents enabling him to ship five stolen cars abroad. He was extradited to his own country where local police were waiting to charge him with armed robbery.

While some bogus claims are laughably stupid in their execution, most involve small one-off claims for a few hundred pounds, the loss of a bag containing a camera, portable stereo and sunglasses, or inflating a genuine claim to include something that never existed.

But even for small-size claims, mounting evidence suggests a resistance by insurers to paying out - or far more stringent checks to ensure that the claim is genuine.

Police who in some countries have traditionally signed forms to say that the loss or theft had taken place, thus allowing a claim to be made in the UK, are beginning to get tough. In one case, a man who "lost" his video camera was visited in his hotel room. His camera was there.

In other cases, insurers add, claims for particular items are claimed for - such as cameras or personal stereos - that were not yet made in the year in which they were said to have been bought. The ABI says that the scale of fraudulent claims adds about 10 per cent to the typical pounds 25 to pounds 40 insurance premium paid for a two-week European holiday.

Tony Baker, deputy director general at the ABI, says: "Travel insurers are determined to stamp out bogus and inflated claims. [They] are aware of most kinds of fraud and will be looking out for tell-tale signs in processing claims."

Sara Joannides, marketing manager at Home & Overseas, adds: "We have ways of checking things up. We do ask for receipts and can spot if they have been doctored in any way. We will call in investigators to look at claims and can ask the police to investigate definite fraud.

"People think this is some sort of victimless crime and we all know that no one likes insurers. But other people's premiums are forced up as a result. In reality, every time someone inflates a claim, they are committing fraud. And we do prosecute fraud".