21 January 2015

Insurance companies in Poland detected in 2013 extortions of damages and benefits for the total amount of almost PLN 130 mln – according to the latest report of the Polish Insurance Association (PIU). 41 per cent more events on the life insurance market (Section I) and 3 per cent more events on the other personal and property insurance market (Section II) were detected in comparison to the previous year. 
PIU has published an annual survey showing data on insurance fraud in Poland. Last year insurance companies detected altogether 8353 offenses involving attempts to extort damages or benefits for the total amount of almost PLN 130 mln. The data divided into key insurance groups are as follows:

Section I – life insurance

• 386 detected events, 41 per cent more than in 2012,
• The value of the detected events – PLN 10.1 mln – 58 per cent more than in 2012,
• The average value of the extortion – about PLN 26,000,
• The most common irregularities were associated with the death of the insured (41 per cent of cases), permanent disability as a result of the emergency insurance, and hospital treatment or surgery (17 per cent each).

Section II – other personal and property insurances

• Insurers have detected 7967 extortions or attempts of extortion (increase year-to-year by 3 per cent),
• The value of the detected events – almost PLN 120 mln, 16 per cent more than in 2012,
• The average value of the extortion – PLN 15,000,
• 66 per cent of cases referred to attempts of extortion of damages on motor third party liability insurance, 23 per cent referred to comprehensive motor insurance, and almost 2 per cent concerned personal accident insurance

– Not everybody is aware that the main victims of insurance criminals are customers of insurance companies. This is because damages and benefits are paid of the premiums paid by customers. So does any insurance system. The phenomenon of insurance crime and social approval of it result in increased insurance rates – says Jan Grzegorz Prądzyński, CEO of PIU.

In the case of comprehensive motor insurance an average extortion amounts to PLN 18,000. Taking into accounts the average market price of comprehensive motor insurance it means that one offense costs as much as the annual premium of 17 honest drivers. And in the case of motor third party liability insurance the average extortion amounts PLN 11,000, and it equals annual premiums for automobile liability insurance paid by 25 drivers.

– The analysis of data on crime detection clearly shows the effectiveness of the detection of attempts to extort damages and benefits is increasing. In particular it is noticeable for life insurance market and for corporation insurances. Unfortunately, we have to deal with increasing professionalization of criminals and participation of the organised crime groups – says Jan Grzegorz Prądzyński.