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Sizzling summer sees fraudulent insurance claims rise alongside mercury Sizzling summer sees fraudulent insurance claims rise alongside mercury
(14 days later)
Insurers are fighting a new type of fraud: holidaymakers who this summer cancelled pre-booked and paid-for trips to foreign hotspots so they could enjoy the heatwave at home instead.Insurers are fighting a new type of fraud: holidaymakers who this summer cancelled pre-booked and paid-for trips to foreign hotspots so they could enjoy the heatwave at home instead.
VFM Services, which works with a number of the biggest travel insurers to uncover fraud, said it believed some holidaymakers had claimed against travel policies citing medical or other emergencies, then basked in the unusually hot conditions enjoyed across much of the British Isles this summer.VFM Services, which works with a number of the biggest travel insurers to uncover fraud, said it believed some holidaymakers had claimed against travel policies citing medical or other emergencies, then basked in the unusually hot conditions enjoyed across much of the British Isles this summer.
The firm said the average claim for cancellation on a travel insurance policy was £1,200, and that fake heatwave-related claims could cost the travel insurance industry hundreds of thousands of pounds.The firm said the average claim for cancellation on a travel insurance policy was £1,200, and that fake heatwave-related claims could cost the travel insurance industry hundreds of thousands of pounds.
"We believe there will be people trying to fraudulently claim on their travel insurance policy because they've cancelled their holiday to enjoy the summer here in the UK, and don't want to pay cancellation costs," Sally Griffiths, director VFM Services, said. "Our investigators are already seeing cancellation claims, and as people return from their holidays fraudulent travel claims will continue to rise as holidaymakers also submit their baggage claims.""We believe there will be people trying to fraudulently claim on their travel insurance policy because they've cancelled their holiday to enjoy the summer here in the UK, and don't want to pay cancellation costs," Sally Griffiths, director VFM Services, said. "Our investigators are already seeing cancellation claims, and as people return from their holidays fraudulent travel claims will continue to rise as holidaymakers also submit their baggage claims."
She added that while travel insurers will identify and validate genuine claims quickly, fraud levels are on the rise. "Travel insurance tends to be a price-led low-value product that often suffers from a lack of customer loyalty, and is therefore more open to fraud compared to other sectors."She added that while travel insurers will identify and validate genuine claims quickly, fraud levels are on the rise. "Travel insurance tends to be a price-led low-value product that often suffers from a lack of customer loyalty, and is therefore more open to fraud compared to other sectors."
Four in 10 insurance claims passed to VFM by insurance companies prove to be fraudulent or result in a zero payout because the claimant walks away after being challenged by claims handlers.Four in 10 insurance claims passed to VFM by insurance companies prove to be fraudulent or result in a zero payout because the claimant walks away after being challenged by claims handlers.
Claims for two lost bags on holiday always spark suspicion, according to insurer Axa. "One lost suitcase is unlucky, but two is unlikely," it said. "When we ask a customer to sign a release form that allows us to approach the airport and ask for CCTV of the carousel we often find that the claimant will walk away and fail to submit the claim."Claims for two lost bags on holiday always spark suspicion, according to insurer Axa. "One lost suitcase is unlucky, but two is unlikely," it said. "When we ask a customer to sign a release form that allows us to approach the airport and ask for CCTV of the carousel we often find that the claimant will walk away and fail to submit the claim."
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