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Brits Bump Up Home Claims By An Extra £246M Per Year

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Brits bump up home claims by an extra £246m per year

AXA, one of the UK’s leading home insurers, believes exaggerated home insurance claims are costing every home around £13 a year on their home insurance premiums.

AXA has seen a rising trend in the last few years of “exaggerated” claims, while industry data reports increasing amounts of ‘fraudulent’ behavior. Research carried out by AXA among insurance brokers reveals that one in three are seeing more exaggerated claims than a year ago.

This was also supported by consumer research which suggests that around 8% of claimants have added an average of £2898 to the real cost of their claim.

AXA’s research also reveals that over a third of people (36%) would be likely or very likely to consider exaggerating a claim if they were to make one, while nearly half the population (47%) believe it’s either fair game or at worst “not too bad” to tell a few white lies when making an insurance claim.

Nationally, those in the West Midlands, Wales and London are the most likely to stretch the truth. While those in the East Midlands and the North East appear to be the most honest.

Men are considerably more likely to exaggerate a claim than women and the amount they exaggerate by is nearly twice that of their female counterparts.

The reason given by one in nine people for exaggerating a claim is that “everyone does it”, while a further one in sixteen state that insurance companies can afford it, demonstrating a lack of appreciation of the impact on other policyholders.

By contrast, when people were asked whether they would commit other financially dishonest acts, only 3% would steal a packet of sweets from a newsagent and only 1% would tell someone they owed them more money than they really did.

Common areas of exaggeration are:

TVs – with numbers of these claims peaking before a big event like the World Cup

watches – where claims are made for a designer watch which in fact is a counterfeit bought abroad

freezer food – people claiming to have had a freezer full of lobster and fillet steak rather than fish fingers and peas

cash – people claiming more money has been taken than actually was.

James Barclay, home underwriting manager at AXA says: “Exaggerated claims have always been an issue for insurers but over the last few years there has been a marked increase. Generally people see it as a victimless crime but ultimately, honest policyholders foot the bill as insurers have to pass on the cost to their customers.

“There are various measures we can use to check on claims and ultimately, people risk having the whole claim turned down if they submit fraudulent details. But we are keen to try and educate consumers that being honest will keep premiums down for everyone in the long run.”

Well, in time the insurance companies will have more inspectors catching out the fraud, the government will be lobbied for heavier penalties on those that are caught.

Perhaps time to put in lie detectors in the claims departments.

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The skin deep morality of the respectable hypocrite.

I am sure a big part of the rise in the cost of motor insurance is due the general view of a minor accident

as a lucky chance to claim a couple of thousand for "whiplash", all connived in and fed on by professionals

such as lawyers and chiropractors.

Many of these would be outraged by anyone comitting an honest crime like stealing a sandwich from a supermarket.

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Well, in time the insurance companies will have more inspectors catching out the fraud, the government will be lobbied for heavier penalties on those that are caught.

Perhaps time to put in lie detectors in the claims departments.

I believe they are already using sophisticated voice detection devices on claims calls from policyholders. These flag up claimants who may be lying.

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Don't get me started on insurance companies.

What about all the people who don't make a genuine claim on a comprehensive vehicle policy because the accident was their fault and they don't want to lose their no claims bonus. I fixed the car my wife hit at a cost of £276 in parts and a few hours of my labour. How many times a day does someone somewhere sort out a deal with the other party that avoids making a claim? The insurers can't have any figures for the savings they make as they are never made aware of the accident.

Then there's the two policies I tried to cancel less than two months before the end. The car policy that cost £124 for the whole year was going to cost me an extra £50 admin fee to cancel. When I told the guy that I would just make the last £9 payment and let it run to the end he said "You can't do that as you have just told me you no longer have the car". Rather than argue I said I would send in the cancellation paperwork. Guess what? I just let the policy run to the end.

The bike policy was different. I was ready this time. When they told me it was £21 to cancel early as against one remaining payment of £11 I told them that there were no circumstances in which I would pay extra to terminate the policy early. Got the same "You have told me you no longer own the vehicle" line. I told him he was free to terminate the cover if he felt obliged to do so but that I was not instructing him to take that action and therefore would not be paying a fee to cover it. He responded with the lame argument that I was accumulating no claims bonus while not at risk! I pointed out that he would be getting one further payment from me on a policy where his company was at no risk of having to make a pay out. He didn't seem able to understand this point and kept harping on about me being obliged to pay. In the end he tried to put me on hold for a second time and I told him that I would not be there when he came back and hung up.

In both of these cases I was just trying to do the right thing and maybe save myself a measly £20.

I've had many more serious run ins with insurance companies in the past and had to sue on more than one occasion. These are just the two most recent examples. Insurers are right up there with politicians and EA's on my hate list. They make claiming a nightmare that many folk find hard to cope with during what is often their hour of need. They are crooks and it is no shock to me that many folk respond in kind.

Edited by Nickolarge

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  • 312 Brexit, House prices and Summer 2020

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      • down 5% +
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