New figures have revealed that annual insurance fraud losses cost local authorities more than £1bn, the Association of Local Authority Risk Managers (Alarm) has warned.
Alarm said local authorities were also hit by the cost of investigating claims, more than half of which were successfully disproved.
It said its recent annual conference raised the issue of "door knocking" by claims management companies who attempt to general clusters of claims in particular areas.
"There was also a view amongst attendees that public sector organisations are seen as a fair target as there are no perceived victims as a result of fraud against them," chief executive Sheila Boyce said.
Alarm has established a special interest group to focus on claims fraud and produce guidance for members.
