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Making a killing: pet insurance fraud is on the increase

It is seems impossible to believe, but false claims on pet insurances are soaring with some owners deliberately maiming or even killing their animals to get a payout. The injuries to animals mirror the 'cash for crash' claims made on cars, where the vehicles are deliberately damaged for the insurance money. Fake claims in the UK on pet policies have almost quadrupled in recent years. Research from the Association of British Insurers (ABI) reveals that the value of detected pet insurance fraud in 2010 was £2million, a sharp rise on the £420,000 detected during the previous year. However, statistics have only been gathered since 2009 and the forecast is for this sector to top £900m in premiums in 2015 – which would also perhaps see a correlation in the rise of fraudulent claims.

It appears that deliberately harming pets is rare, but what shape does fraud in the sector then take? Generally, it falls into one of five sectors: fraudulent exaggeration (inflating the value of the lost pet or vet bills), non-disclosure (a failure to notify insurers of a pre-existing medical condition), misrepresentation (lying about the circumstances of an accident), use of fabricated evidence (such as false vet's bills) and staged loss (claiming for a pet that does not exist).

Whilst pet fraud is nowhere near as serious a problem as it is in other markets, the industry is still set to keep a watchful eye and to deploy techniques applied to discover fraud on home and motor policies. The increase in pet fraud figures is not seen as a significant cause for concern as there is a lack of evidence to suggest organised fraud – that which does occur tends to be the action of an opportunistic fraudster.

Thankfully, it is extremely rare, but there have been cases of people maiming or killing their pets for financial gain – and in some cases, the vets have also been involved. Whilst the number of cases of pet fraud remains relatively low, there are those who view this as being in its infancy and consider insurers may be exposed to a growing menace. Some insurers are acting already, employing vets to validate invoices and providing their claim handlers with more training.

It seems that pet owners do have a very fertile imagination. One lady in Dorset claimed to have had no fewer than eight dogs suffer broken legs. When the insurance company investigated, they smelt a rat and the claim was rejected on the grounds that the dogs had never suffered such injuries: upon further investigation it was discovered the dogs had never existed! The lady in question was jailed for 38 weeks.

Two brothers who masterminded a £104,000 insurance swindle also received a jail sentence. They were at the centre of a wide-reaching fraud ring involving claims for stolen jewellery and damage to property and cars. Part of their claim involved two pedigree bulldogs that had 'gone missing' – but again, these proved to be mythical creatures which had never existed. It goes to show that claiming for 'pretend' pets does not pay! The ABI is arranging a shared database of information about insured animals to detect fraud, so the net is tightening still further.

As a nation of animal lovers, we generally do our best to take care of our pets. In 2012 the statistics of the Pet Food Manufacturers' Association stated that there are around 8 million dogs and 8 million cats living happily amongst us, with 23% of UK households owning at least one dog, and 19% at least one cat. Pet insurance is therefore a sensible purchase – and can be affordable if you shop around. Take professional advice – at Westhill Insurance Services we will take the time to gather all the information we need about your pet(s) and then find the best possible insurance cover to suit them as well as your budget.

So whilst dogs come when they're called and cats tend to take a message and get back to you later, why not make one quick call to Westhill Insurance Services?

Contact Westhill Insurance Services, today.

Posted on 23rd May, 2013