Lying on insurance claims

Most car and insurance claims have some element of fraud in them. When I was consulting I worked with someone who said that something like 40% of accidents never happened at all (or at least not in the way described), and another 40% were materially mis-stated or inflated. Leaving just 1 in 5 that were exactly as claimed (ever wondered why you are felt to feel like a criminal when you talk to an insurance company – because 4 in 5 claims contain lies on those stats).

Thankfully we’ve not had to claim for many years, but 3 weeks ago someone bashed into the side of Sa’s car when she was taking A and K to school.  A pretty easy case to settle since the driver of the white van (for a white van it was) turned right from the middle lane and Sara was in the right hand lane.  Not something physics allows without consequences!  An open and shut case you’d believe – we did.  Now though, they are disputing liability, claiming that “the insured was in the correct lane to turn right when your client overtook using the parking bays and collided with our insureds correctly proceeding vehicle.”.  Thanks to the wonders of satellite imagery, it is easy to see how laughable a claim this is (click on photo for larger version) :-

Can you see the parking bay on the right of the road? It’s about 6 car lengths long, and barely wide enough for a car (the mirrors hang over the road and pavement).  A Ferrari would have trouble getting past someone in that distance, and would have to suck it’s side’s in to achieve it.  And, since anyone going slowly in the right hand lane is probably turning right, even the road sense of a testosterone fuelled 17 year old male learner driver would say it’s a dumb idea.  Sa drives the road every school day, and knows it well, so hardly probable that she’d throw all caution to the wind in a manic dash … in a diesel Renault Espace.  Sa certainly ended in equivalent parking bay the other side of the side road, as she steered to avoid the impact … but could not have been there to start with since she didn’t hit the kerb, as she surely would have done.

On the other hand it seems easy to believe that the white van, who said at the time that it was his first time in Nottingham, got confused about which lane he should be in as he came off the roundabout – there is a discontinuity in lane alignment before the section shown above that makes it surprisingly easy to end in the middle lane as you sweep around the bend.

So, should be easy to push back on the claim.  But, what is irritating is that the counterparty seems to believe that it’s OK to ‘try it on’.  We are in a quandary though.  Experience says that we need to give them some way to back down – e.g. to say that they ‘may have an error in their recollection’. That allows them to give way without admitting that they were lying through their teeth.  That’s what we’ll do, but equally, if everyone does that it allows people to go on trying it on, knowing that there’s little consequence.

What I am left wondering is how we can disincentivise people from lying in insurance claims.  If there was a way of flagging cases across the industry then it would make a great risk selector, so driving insurance rates up heavily for perpetrators.  Or, insurance companies could publically declare that they will start pursuing materially inflated claims and lies in statements in court.  Give everyone a years notice so that  they are properly aware, and who knows what change in behaviour we might get.  In the mean time I guess we better write the response to this silly letter.

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One Response to Lying on insurance claims

  1. Jim Pye says:

    Not sure if this reply will get linked to the Climate Change post or the Insurance lies one. It is meant for the latter.
    I couldn’t agree more. Harry had a terrific tussle with a woman who walked into the side of a disability community bus he was driving (as a volunteer) and she claimed that he drove into her. He had to do some clever detective work and point out some facts that disproved here claim before she went away. She wanted take him to court for dangerous driving. It beggars belief sometimes. Jim

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