Jewellery fraud is now costing the insurance industry £70m a year, Loss Management Group (LMG) has warned.
The Bath-based jewellery claims specialist refutes a ABI survey which showed that 15% of household claims were fraudulent. It claims that jewellery fraud is on the increase, with as many as one in three jewellery claims having either fraudulent or inflated aspects.
Stephen Kopaloff, jewellery manager at LMG, said: "The problem is made worse by the fact that most insurers do not know what they are insuring before they insure it.
"The lack of adequate pre-loss documentation makes effective claims assessment difficult. So insurers often end up forking out because they are worried about upsetting their customers."
According to LMG, the peak months for jewellery fraud are
January, when customers feel the pinch after Christmas spending, and in September, after the holiday period.
"The incidence of jewellery claims tends to be in inverse relation to the economic cycle," Kopaloff adds. "It is a fact that there are fewer claims for jewellery loss when the consumer feel good factor is high."
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