Caroline Jordan, Danielle Gray - Exclusive
The estimated cost of fraud to the insurance sector could rise according to a new study being conducted by the ABI and the City of London Police.
Current figures state that fraud costs the insurance industry around £1.5bn a year. However, the study will incorporate areas such health insurance fraud that have previously not been considered.
The updated figures will be produced next May as part of a survey being prepared for submission to the government's fraud review team.
The ABI will contribute figures from the insurance sector for the project, which will be overseen by the City of London Police.
Detective chief inspector Oliver Shaw of the City police said: "The project is currently out to tender with some universities as we want it to be independent.
"We expect it to produce more accurate figures and it may well bring to light scams that we are currently unaware of."
ABI launches internal fraud probe
The ABI has begun an investigation into internal fraud with the insurance industry.
A working group has been set to examine the risk exposure to the industry.
Jamie Bell, ABI financial crime and fraud director, said the group would analyse the issue of internal fraud and develop recommendations to address the threat.
It will also look at ways to increase the industry's involvement with fraud prevention service CIFAS.