Exaggerating accidents, burning the business down and cold-blooded murder are just some of the lengths that people go to in their efforts to cheat the insurance industry.
In the first of a three-part series, Morland Sanders (pictured, left) follows the investigators determined to bring them to justice.
The most high-profile case is vintage-car enthusiast Lord Charles Brockett (pictured, right). At one stage he owned 42 Ferraris, but when the classic-car market collapsed in the mid-1990s, he tried to offload some of his vehicles quickly. He claimed four of his cars had been stolen and tried to get £4.5 million from his insurers. But it was a scam, as he had actually dismantled the vehicles. In 1996 he was jailed for two and a half years for conspiracy to commit car insurance fraud.
My neighbour sued me over a boundary using Before the Event Legal Expenses Insurance (BTELEI) to which she was not entitled. She had sued me previously and that first case included the same boundary dispute. My neighbour used the same solicitor for both cases. To obtain the BTELEI required the connivance of this solicitor; it is not possible to sue someone using BTELEI without a solicitor.
I gave Direct Line (my neighbour’s insurer) the details of the first court case (in advance of the second court case) in the belief that they would withdraw cover from my neighbour and thereby stop that court case. What Direct Line actually did was wait until after the case, when they were presented with a bill for £35K by my neighbour’s solicitor, to withdraw cover. Thus I was obliged to fund a defence to a court case that was brought using a fraudulent BTELEI application with the full knowledge of Direct Line.
I joined my neighbour’s estranged husband to the claim for harassment. He too used BTELEI cover from Firstassist and had the same solicitor as his wife. Needless to say his harassment had also featured in the first court case and he was therefore not entitled to Before the Event insurance cover; his solicitor was well aware of the previous allegations against him in the first court case.
Firstassist could have tackled this matter before the second court case however they too did nothing proactively. I lost this part of the claim but because it was on the Fast Track my costs risk is limited therefore in the near future Firstassist will receive a bill for his costs of about £5k.
These insurance companies only pay lip service to dealing with insurance fraud, what they do in reality is suit their own ends at all times. As a third party the FSO or FSA will not deal with this matter on my behalf. The Solicitors Regulation Authority and Legal Services Ombudsman will not investigate crooked solicitors in any meaningful way.
If you know of an insurance fraud you should consider you options. Bringing insurance fraud to the attention of the company concerned can be a very expensive experience particularly when the insurer as in this case suits their own ends rather than tackle the fraud proactively.
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