The festive season will bring increased claims for insurers

‘Tis the season to be jolly. But not for insurers unfortunately. It is anticipated that thousands of families will fall victim to burglars over the festive season, resulting in an increase in home insurance claims. While burglaries increase in the pre-Christmas period during most years, there is a school of thought that this year the rate of thefts could be higher than usual due to the worsening economic climate.

However, research by moneysupermarket.com shows that insurers factor the expected increase in burglaries into their calculations. Most insurers actually increase the amount of cover they offer over the Christmas period by up to 10 per cent at no extra cost to the policyholder. But this is not always the case – the moneysupermarket.com study revealed that while the AA increases contents cover by 20 per cent during the festive season, Endsleigh does not offer extra cover on standard policies, with the result that families could find themselves under insured if they were to suffer a break-in.

With the prospect of a surge in burglaries during the month of December, insurers will be bracing themselves for a corresponding increase in claims. But the bad news for the industry does not end there. Insurers will also have to deal with an equally unpleasant phenomenon. There is anecdotal evidence that fraudulent claims increase during this period because fraudsters view the growth in the burglary rate as an opportunity to cash in.

Police in south Wales this week highlighted how some families in the Neath Port Talbot region were making false theft reports with a view to defrauding their insurers. Jason Davies, acting detective inspector at Neath Port Talbot Police said: “Unfortunately we have attended a number of burglaries recently where the reporting people have come up with a false report, usually in an attempt to commit an insurance fraud – these individuals are currently under investigation for committing deception offences.” Davies added that if the Police are able to find evidence that a report was “not genuine”, the offenders will be prosecuted.

Meanwhile, in addition to cracking down on false crime reports, the Neath Port Talbot Police have also launched a campaign to tackle the pre-Christmas rise in burglaries. As well as waiting in crime “hot-spots” with the aim of catching thieves red-handed, officers will adopt the unusual approach of sending Christmas cards to known burglars in order to publicise the crackdown. If initiatives such as this are successful, insurers may not suffer as much as expected this Christmas.