2006
(26/07/2006) AXA gets tough on organised insurance fraud
- Criminal gangs can earn up to £4 million a week from insurance fraud1
- In 2005 insurers managed to detect fraudulent claims worth more than £400 million1
- Bogus insurance claims cost over £1.5 billion a year1
- Fraud adds 5% to the premiums paid by honest customers.1
An initiative launched today to target and expose organised insurance fraudsters receives the full backing and support of insurance giant, AXA. The new Insurance Fraud Bureau, in which AXA plays a big part as a member of its Operational Steering Group, has been set up to help stamp out the staggering £1.5 billion per year paid out in bogus insurance claims. It is estimated that such claims add around five per cent to the cost of insurance premiums, with organised fraud now earning criminal gangs up to £4 million a week.
Insurance companies have become more proficient at identifying and stamping out all types of insurance fraud; in 2005 some £400 million of fraudulent claims were exposed and stopped. However, there has been a growth in the number of systematic fraudulent claims perpetrated by highly organised gangs, who use sophisticated methods which are much more difficult for individual insurers to spot on their own. The new bureau has been set up to provide a cross-industry approach to tackle this problem.
Common types of organised insurance frauds include staged or induced motor accidents, fraudulent arson and supplier/contractor fraud. Such crimes not only end up costing honest customers but could also endanger innocent people's lives.
Richard Davies, Deputy Chairman of The Insurance Fraud Bureau and Fraud Risk Manager at AXA said: "We are 100% behind this new crime-busting initiative and believe that a cross-industry approach will have a big impact in tackling a problem of this magnitude. The launch of the Insurance Fraud Bureau means that we can share intelligence and better co-ordinate investigations between insurers, the police and other agencies.
Organised insurance fraud is becoming increasingly difficult to spot, with insurers often being simultaneously targeted by criminals who now use very sophisticated methods. We have already taken significant steps to stamp out these gangs and can only expect that the new Insurance Fraud Bureau will help AXA and the rest of the industry to work together on even smarter basis."
- Ends -
Notes to Editor
1. Figures provided by the ABI.
About the IFB
- The IFB will analyse data from industry databases: the Claims and Underwriting Exchange (contains details of household, motor, and personal injury claims made in last five years); the Motor Insurance Anti - Fraud and Theft Register (stolen and written - off motor claims) and the Motor Insurance Database (details of all motor policies).
- The IFB is led by an Operational Steering Group of insurance fraud risk managers from Royal and SunAlliance, AXA UK , RBS Insurance, Norwich Union, Esure, Zurich , Allianz Cornhill, and representatives from the database administrators, ISDL and Polaris. The Bureau is based in London .
- The IFB supports the wider insurance industry and the ABI's anti - fraud strategies. Activity is aligned with the National Fraud Strategy and Serious and Organised Crime Agency, enabling the insurance industry to make a case for effective prosecutions.
- The IFB also operates the Fraud Cheatline. Anyone with information on a suspected insurance fraud can call this free, confidential helpline on: 0800 328 2550.
- For more information: www.insurancefraudbureau.org
About the ABI
The ABI is the trade association for Britain's insurance industry. Its more than 400 member companies provide over 97% of the insurance business in the UK. We represent insurance companies to the Government, and to the regulatory and other agencies, and provide a wide range of services to our members. ABI member companies account for more than a fifth of investments in the London stock market.
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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.