The Issue
The reported rise in total loss claims for prestige vehicles presented by accident management firms is perhaps an area for concern. Whilst case law does not require a party to utilize their own insurance policy in a non-fault accident, it does tingle the fraud sensor when the claim is presented by an unknown Accident Management firm. The QGLaw Counter-Fraud Team has recently handled a good example of this.
Brief Summary of Facts
The policyholder claimed, through the Accident Management Firm, that he had been involved in an RTA that occurred on a country lane. He initially told the GAP insurer he was returning from football, though in a later call stated that the accident occurred when he was returning home from seeing a friend. The discrepancy was small but sufficient to alert the GAP TPA to undertake a fraud validation.
The Investigation
Detailed further enquiries established that the policyholder was not being truthful as to why he was at the location when the alleged accident occurred and two further lines of enquiry proved to be of great assistance:
The QG Intelligence database enquiries confirmed that the policyholder had been investigated for two previous suspected fraudulent insurance claims and Police Scotland were able to share significant intelligence confirming the policyholder’s association with organised crime
The result
QG Law declined the GAP claim on the grounds of fraud and that declinature has met with no challenge.
We are now about to pursue a recovery for the motor insurer that paid the primary claim.
Key Practice points: the Key Fraud indicators
- While a policyholder is under no obligation to utilise their own policy and there may be legitimate reasons not to do so, this could be a warning flag to consider when a claim is presented and may lead to a fraud finding through further investigation.
- The total loss claim occurred towards the end of the 3-year GAP policy term
- A substantial claim value of £160k
- The total loss was based on a desktop assessment completed by an engineer instructed by an Accident Management firm known for sub-standard reporting
- A previous policy in the name of the policyholder had been cancelled at the request of the police with reference to criminality
All these indicators were identified by QGLaw, resulting in a substantial saving of £60k for the client.
If you have any questions about this article or wish to discuss any of the points raised, please contact Kellie Lacey on Kellie.Lacey@qglaw.co.uk