Motor Insurance still wide open to fraud – AA

Despite the news of a person being jailed for motor insurance fraud last week the sector remains wide open to abuse because some basic innovations, standard in the UK, have not been implemented according to the AA.

“There have been some people caught recently but that was because they were very foolish criminals, not because the system to detect them is effective.” Say Director of Consumer Affairs Conor Faughnan.

The AA estimates that the cost of insurance fraud in Ireland as adding up to €50 to every premium. There are fraudulent claims but there is also fraud at the point of purchase because Insurance Ireland has not yet completed the task of creating an integrated hub for data-sharing amongst providers. The system, known as Integrated Information Data Service (IIDS), is still held up in development in Ireland despite the fact that its equivalent is functioning well in the UK including Northern Ireland.

The AA reports that it regularly receives fraudulent documentation in respect of No Claims Discount records and insurance history. The AA detects these and flags them to the Garda as appropriate.

“The AA has the resources and sophistication to detect these because it is the biggest intermediary in the country.” Says Faughnan. “But there are plenty of other providers that are being conned needlessly.”

The AA is calling on Insurance Ireland to speed up the development of the IIDS. This will provide a centralised hub for customer information on a person’s insurance record, driver licence details and penalty points status. Insurers will no longer need to obtain paper copies of these documents which are so readily faked. A similar system is already in place and working across the border in Northern Ireland.

“Too often deceitful individuals are able to obtain valid insurance windscreen disks.” Says Faughnan. “By the time their insurer finds out they have been conned the individual has a disk which will make them appear legal to any Garda on the road.”

The AA has already stated that windscreen disks should be abolished and replaced with a proper modern data-base system. That coupled with a working IIDS hub will make it far more difficult for a deceitful individual to obtain motor insurance under false pretences.