Fraud In Liability

1. Fraud In Liability 31st October 2007 Simon Arundel Compliance & Fraud Manager Ecclesiastical Insurance Sarah Hill Partner Berrymans Lace Mawer

2. Divine Guidance… • Thou shalt not steal. • Thou shalt not bear false witness.

3. What Is Fraud? • Contrived, fictitious, staged losses • Gross exaggeration • Dishonest Non-disclosure / Misrepresentation

4. What does it look like in Liability? • Motor – Organised, contrived and staged. • Regional and cultural • Property – Opportunist. • ad-hoc. • EL & PL – High ratio, opportunist exaggeration, • becoming more organised, contrived.

5. Examples - Motor • Genuine modest impact to rear of TP car. TP embellishes the whiplash claim. • Genuine minor, low speed impact to rear of TP car. TP claims whiplash, when none was suffered. • Genuine minor collision, two injury claimants yet only one occupant in car. • Collision forced (contrived) by one party against the other. • Collision is staged between the parties. • Numerous collisions are staged among a network with “spaces” in vehicles sold.

6. Examples – Property liability • Genuine accident. Claimants overstate value of damage. • Genuine accident. Claimants invent lost items. • Genuine accident. Claimant’s invent witnesses. • Claimant’s contrive the loss circumstances. • Conspiracy to fake the loss. • Multiple losses are claimed, supported by a network sharing the profits.

7. Examples – EL & PL • Genuine incident, effects embellished. • Genuine incident, invented heads of damage. • Genuine incident, grossly inflated claim. • False attribution of genuine loss to non-causative incident. • Contrived incident, false losses. • Systematically creating or supporting false claims.

8. Detection • Indicators • Intelligence • External

9. Indicators • Claimant supervisor suffered back injury when trousers caught in a hook on fork lift. • Fork lift unavailable when LA attends. Two employees give evidence to support circumstances. • Personnel file shows claimant has history of bullying. • Claimant had survived disciplinary over alleged theft from work by agreeing not to make claim - now reneging.

10. Claimant is sacked… • Witnesses admit to making false reports under duress and testify that claimant was larking about on a pallet truck from which he fell.

11. What we need from the adjuster… • Attention to detail • Corroboration • Admissible evidence

12. Which of these is good evidence of fraud? • Insured says he thinks the claimant is moonlighting. • The insured says a friend has seen the claimant leaving home in the morning several times. • The friend gives a statement describing the claimant and how he leaves home each weekday morning at 7.30AM with a satchel and gets a lift in a white van. • Surveillance film shows the claimant at work elsewhere contrary to alleged incapacity as described in his answers to Part 18 questions.