Forty seven percent of the general public would inflate a claim, according to new ABI research.
The ABI's Attitudes Towards Honesty Index sampled 2,000 adults and revealed the extent of insurance fraud was part of a wider public uncertainty about what was deemed dishonest.
It found 7% of people admitted to having made a fraudulent claim and insurance cheats were also more likely to also commit other crimes. The index showed that of those who had made a fraudulent claim, 53% admitted to knowingly buying stolen goods and 31% said they had shoplifted.
ABI head of financial crime prevention Debra Weekes said insurers were "raising their game" and making it more difficult for fraudsters to succeed.
She said: "The greater the chance and the consequences of getting caught, the less likely people are to act dishonestly.
"This is why insurers are increasingly working together, on things like developing an industry-wide electronic anti-fraud database, to ensure the net closes further in on insurance fraudsters."