Nine new towns and cities have become motor fraud black-spots, according to the fifth annual Motor Fraud Index produced by law firm Keoghs.

Keoghs defines a black-spot as postcodes where more than 250 suspect claims were reported over the year.

Equally, the proportion of postcodes classed as low-risk (fewer than 30 suspect claims) dropped to 19% in Keogh’s 2012 index compared with 33% in the 2011 index.

Birmingham topped the Keoghs Motor Fraud Index for the second year running, and was joined in the top five by Liverpool, east London, north London and Bradford (see table below).

With the exception of Bolton, every one of the 40 worst-affected areas saw a net increase in the number of suspect claims between 2011 and 2012. Only seven of the 108 postcode areas in England and Wales saw a decline in suspicious claim numbers.

Keoghs said the increase in the Greater London area was of particular concern, where the total volume of suspect claims increased 115% in the past year.

The law firm said its index was consistent with the latest ABI figures, which show that the number of fraudulent claims being detected by insurers has increased by 9% in the past year.

“These results show that fraudulent motor claims have continued to spread rapidly across England and Wales,” said Keoghs director of counter-fraud strategy James Heath. “The volume of claims flagged as suspicious by insurers has increased across the board and, at the same time, the geographical distribution has continued to spread out from the well-known problem areas.”

Heath said that the number of people turning to fraud continued to rise given the tough economic climate.

“ Insurance fraud has become an organised criminal enterprise in many areas of the country and there is evidence that high levels of unemployment may be increasing the temptation for people to take part in these scams,” he said.

“Advances in identification techniques and joined-up investigation of claims between insurers and law enforcement agencies has allowed insurers to cast their net much more widely than was previously possible, and fraud is being discovered virtually everywhere we look.”

Keoghs’ annual Motor Fraud Index is based on the thousands of suspicious claims investigated by Keoghs on behalf of its insurer clients.

Keoghs Motor Fraud Index 2012