By Michael Lavery
Thursday October 04 2012
ONE in five Irish people lies and submits false information in order to secure cheaper insurance policies, it has emerged.
New research has revealed how data protection rules in this country mean Irish insurers are losing out in the battle to combat €100m insurance frauds every year.
Unlike their UK counterparts, Irish companies cannot access claims databases.
This means insurers cannot cross check information they get from consumers at the policy quote stage for car and home insurance, the Irish Brokers Association said.
Failing to disclose previous claims, penalty points or convictions mean people get lower motor premiums. But in many cases insurers will not even give a quote to someone who has driving convictions.
Brian McNelis of the Irish Brokers Association said the experience of his members was that this “insurance fraud” was three times higher than previously thought.
The representative body say that in the UK brokers have access to claims databases.
These tools are effective in combating the fraud problem but data protection laws in Ireland mean it is not possible to share data here.
Mr McNelis said: “Although official numbers say that insurance claim fraud occurs in around 7pc of cases, our broker members have suggested that in reality this figure could potentially be closer to 20pc.”
There is a claims database operated by the Irish Insurance Federation but access to this is restricted due to data protection laws.
“So in essence we are faced with a situation whereby insurance companies can only access this data when a claim occurs instead of when they are underwriting an insurance policy for a particular individual.
“In order for this to work effectively we would need to build an insurance fraud register which could tie in with the existing database and which would alert insurers to cases of fraud,” the IBA boss said.
– Michael Lavery