2006
(16/03/2006) Business crime cost £721 million in 2005
- Crime related business claims increased by a massive 27% in Q4 2005
- Theft and malicious damage account for 95% of all crime claims settled
- Arson accounts for 5% of crime claims but 42% of settlement costs
New research from AXA Insurance reveals that in 2005 the cost of crimes against British small and medium sized businesses (SMEs) was at least £721,637,6531. However, AXA believes that the 'true' cost of business crime is much higher as many offences will not be claimed for. In addition many more SMEs are either not insured at all or have inadequate cover. The latest findings of the AXA Business Crime Index, which are based on the company's own claims data2, show that one in five of all claims settled on behalf of businesses in 2005 was crime related.
In the last three months of 2005 alone, the number of crime related business insurance claims settled by AXA increased by a massive 27% compared to the previous quarter. The average claim payment made during the period was £3,942. This was up from £3,337 between July and September the average amount was £3,337.
Commenting on the results, Neil Mercier, property insurance manager at AXA, said: "These findings demonstrate just how much of a problem crime is for small and medium sized businesses. Crime accounts for one-fifth of our entire claim book and while most are low-level, inexpensive crimes such as petty theft and malicious damage, some claims run into tens of thousands of pounds and can put enterprises out of business entirely.
While it is impossible to stop a determined criminal, there are measures businesses can take to protect their premises, stock and staff from the threat of crime and we recommend managers and owners of small enterprises review the security measures they have in place and conduct thorough and regular risk assessments. Our website, www.axa4business.co.uk contains a range of guides for SMEs including on how to protect themselves from criminal activity."
Quarter four findings from the AXA Business Crime Index
Arson is the most financially crippling crime small businesses face accounting for less than five per cent of crime related claims but over forty per cent of the settlement amounts. Theft is the most prevalent type of crime facing businesses accounting for nearly two-thirds of crime related claims settled by AXA.
| Type of claim | % of all Crime Related Claims Settled Q4 2005 (cost) | % of all Crime Related Claims Made Q4 2005 (numbers) |
|---|---|---|
| Arson | 42.12% | 4.49% |
| Forcible/Violent Entry/Exit | 0.77% | 0.78% |
| Goods in Transit | 0.01% | 0.02% |
| Malicious Damage | 12.13% | 32.64% |
| Money/Hold Up | 0.00% | 0.02% |
| Money (non-forcible) | 0.01% | 0.11% |
| Theft | 44.95% | 61.94% |
UK business crime by city
Derby tops the city business crime table, with 30.7% of claims settled between October and December being crime related. Derby is followed by Bradford (30.5%) and Nottingham (28.91%). London (16.6%) had the lowest percentage of crime related business insurance claims settled over the period.
| City | % point Change Q2 2005 to Q3 2005 | % Claims resulting from crime Q3 2005 |
|---|---|---|
| Derby | 4.44% | 30.73% |
| Bradford | 8.52% | 30.46% |
| Nottingham | 1.71% | 28.91% |
| Cardiff | 0.70% | 26.97% |
| Middlesbrough | 7.22% | 25.00% |
| Liverpool | 4.32% | 23.51% |
| Ipswich | -4.47% | 23.11% |
| Birmingham | 0.82% | 22.32% |
| Manchester | -0.46% | 22.08% |
| Bath | 0.14% | 21.88% |
| Leicester | -2.22% | 20.73% |
| Leeds | 2.01% | 20.28% |
| Edinburgh | 6.60% | 20.05% |
| Norwich | -0.36% | 19.76% |
| Glasgow | 0.70% | 18.49% |
| Bristol | 0.20% | 18.14% |
| Newcastle | 2.58% | 17.33% |
| London | 0.05% | 16.61% |
AXA offers a free crime prevention toolkit designed to help businesses protect themselves against criminal activity. The AXA Business Security Blueprint provides best practice advice on everything from securing windows and doors to CCTV and fire suppression systems. It can be downloaded free of charge from www.axa4business.co.uk.
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More information
If you are a journalist and require further information contact one of our media team
About AXA's Business Crime Index
1The figures are based on AXA's claim payments in 2005, and its share of the SME population in the UK.
2The index is based on figures from AXA's own claims database. This release covers findings from October, November and December 2005.
About AXA
AXA is a world leader in financial protection. AXA's operations are diverse with major operations in Western Europe, North America and the Asia/Pacific area. AXA employs 120,000 staff and tied agents and, as of 31 December 2005, had € 1,064 billion in assets under management. AXA reported total IFRS revenues of € 72 billion and IFRS underlying earnings of € 3,258 million for the full year 2005. Our previous company performance is not a guide to how we may perform in the future.
AXA ordinary shares are listed on the Paris Stock Exchange; AXA American Depositary Shares (ADSs) are listed on the NYSE under the ticker symbol AXA.