Pet Insurance Fraud Soars

| November 17, 2011 | 0 Comments
Pet Insurance Fraud Soars

Pet insurance fraud almost quadrupled last year according to the Association of British Insurers (ABI).

In 2010 pet insurance fraud totalled £1.9 million, while in 2009 it was just £420,000 according to the ABI’s figures, although the true scale is believed to be even higher.

Policy holders are trying to cheat the system in a number of ways including getting rid of their pet by selling it or even killing it, in order to claim on their policy for early death.

Some unscrupulous characters have resorted to injuring their pet in a fake accident in order to cover up pre-existing injuries or to disguise conditions that aren’t covered by their policy.

Vets themselves are believed to be involved in some of the scams, which include claiming for expensive treatment that was unnecessary or was never carried out.

Unlike doctors, there is no requirement for vets to use the cheapest drugs available.

Sainsbury’s recently reported that the average claim on its pet insurance rose by 34 per cent in 2010 compared with the previous year.

In 2010 a typical claim for vets’ bills for a crossbreed dog was £416.35, compared with £333.83 in 2009, while vets’ bills for a crossbreed cat rose from £253.84 to £327.54.

Pet insurance policies are susceptible to fraud because veterinary records do not always follow animals around and can therefore be difficult to trace.

Fraudulent claims for pet insurance, as in any other area, push up the cost of premiums, and it is now the fasting growing area of insurance crime.

In order to tackle the problem the Association of British Insurers is establishing a shared database of information about insured animals.

Lloyds Banking Group has decided to close its Halifax Pet Insurance division, leaving policy holders to find alternative insurance providers.

However, with new insurers refusing to cover for pre-existing conditions, the move has angered some policy holders whose pets are already receiving treatment for chronic conditions.

The bank is reviewing complaints from policy holders.

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