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 home insurance has seen a rising trend in the last few years of “exaggerated” claims, while industry data reports increasing amounts of ‘fraudulent’ behavior. Research1 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 research2 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.
WANT TO BUILD A FINANCIAL EMPIRE?
Subscribe to the Global Banking & Finance Review Newsletter for FREE Get Access to Exclusive Reports to Save Time & Money
By using this form you agree with the storage and handling of your data by this website. We Will Not Spam, Rent, or Sell Your Information.
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.”
Helene Barnes, AXA Press Office (020 7400 1907)
Miranda Seymour, Paratus Communications (07966 549413)