A new report published by Aviva car insurance puts forth the claim that an extra $2 billion a year in added costs due to rising insurance fraud. The study was conducted by Pollara Strategic Insights, using electronic interviews conducted with citizens from all 10 provinces.
Conducted within the month of October, 1,502 people were polled for the study and is considered accurate within plus or minus 2.5 percentage points, 19 times out of 20. One of the most interesting things about the study though, is the high percentage rate (81%) of the focus group feel that the increase in insurance premiums stem from fraudulent vehicle repairs, vehicle theft or personal injury claims.
“Honest consumers are paying out of pocket an estimated $2 billion a year in added costs for criminal frauds being perpetrated on the auto insurance system. It’s time to fight back. This report shows that Canadians agree with us,” said Greg Somerville, President and CEO, Aviva Canada.
Out of the all of the provinces polled, Aviva states that those living in Manitoba face the highest risk of auto insurance fraud. Elsewhere in the report Aviva states that 67 per cent of the focus group feel that cracking down on fraud would reduce their current auto insurance premiums. A further 50% of the group believe there is too much advertising encouraging people to use personal injury lawyers. Now while this information is enlightening and technically valid, it is also important to keep in mind where the study is coming from, in this case, one of the biggest auto insurance brokers in the country.
Other parts of the report that we found interesting, were the specific way Aviva breaks down fraudulent auto insurance practises. Under the header “Becoming Insured,” things like unlicensed intermediaries, meaning individuals not legally allowed to set-up policy infrastructure, but charging fees, passing off bogus information and creating policy anyway. Aviva warns that consumers who fall prey to this type of activity might not be covered if they make a claim. Different tidbits of information ranging from staged vehicle thefts, auto repair shops who greatly exaggerate the amount of required to fix a problem.
“Aviva Canada is fighting fraud on behalf of all those honest drivers who are paying higher premiums to fund the fraudulent activities of a small minority of individuals ripping off the system. We asked Canadians what they thought about auto insurance fraud issues, and the message you sent us in our national public opinion poll came across loud and clear,” Mr. Somerville added.
You can read the full Aviva report here.
Deborah McCoy – Is an investigative journalist and has over 17 years of investigation experience in both the private and public business sectors. Since joining CFN, Ms. McCoy has become a true advocate for victims of fraud and increasing the public’s awareness in fraud prevention.