ICBC launches auto insurance fraud education campaign
The corporation is now reminding British Columbians, through a new advertising campaign, of the serious nature and cost of insurance fraud.
Following December’s news that ICBC had generated its first results from a new high-tech tool which will help identify and target fraudulent claims, the corporation is now reminding British Columbians, through a new advertising campaign, of the serious nature and cost of insurance fraud.
“The goal of this information campaign is to show British Columbians that exaggerating an injury for financial gain is wrong,” said Chris Fairbridge, ICBC’s manager of the Special Investigation Unit (SIU).
Most claims are honest, but insurance industry studies estimate that fraudulent or exaggerated claims make up about 10 to 20 per cent of all claims costs. Applying those estimates means that fraud and exaggeration is costing ICBC customers up to $600 million a year, or more than $100 a year for each ICBC policyholder. The 2016 public information campaign sparked a 70 per cent increase to ICBC’s fraud tips line in the first quarter. Overall last year, the fraud tips line received nearly 1,900 calls – a 66 per cent increase over the volume of tips in 2015.
“We want the public to better understand the role they can play so we can work together to best prevent fraud,” added Fairbridge. “Tips help us take action by investigating suspicious situations in order to protect the majority of our customers who file honest claims.”
In 2016, ICBC’s Special Investigation Unit completed close to 10,000 investigations. ICBC expects fraud detection and enforcement activities to reduce ICBC’s basic insurance claims costs by $21 million for policies written over the next year. And ICBC estimates all of these activities, including use of the analytics tool, will save up to $44 million a year by 2019.
The most common types of insurance fraud include false claims, exaggerated claims and organized fraud. An example of a false claim is when an owner fabricates a story about their vehicle being stolen when it was actually disposed of by the owner. Exaggerated claims are when a driver or passenger embellishes a claim by overstating their injuries or the damage to their vehicle. And organized fraud is a planned event such as a staged collision.