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article imageUK travel insurance fraud rockets due to summer heatwave

By Dawn Denmar     Sep 6, 2013 in World
Travel insurance claims for cancelled holidays or lost baggage are rising for the summer of 2013 thanks to the short UK heatwave. It's believed holidaymakers cancelled pre-booked holidays so they could enjoy their days roasting in the UK instead.
The Guardian newspaper reports today that this type of insurance scam is on the increase. Traditionally, the travel insurance industry has low claim thresholds and is price-led and low-value. It's possible this could change, though, if the numbers of claims handled typically increases to levels seen this year.
VFM Services works to uncover fraud in the insurance industry and says it believes some holidaymakers have cancelled overseas' holidays citing medical emergencies or other reasons. VFM say: "Our investigators are already seeing cancellation claims, and as people return from their holidays fraudulent travel claims will continue to rise as holidaymakers also submit their baggage claims."
Four out of every 10 insurance claims passed to VFM turns out to be fraudulent or is not followed through by the claimant, following challenges from the investigators. In claims for lost baggage, VFM contact airports for CCTV footage of the baggage carousel. Often, when VFM asks the claimant to sign a release enabling them to approach airports it is quite common for the customer to fail to continue with the claim.
One VFM claim handler estimates 45 percent of its travel claims are fraudulent, with 60 percent dropped after just one phone call to the claimant.
The average claim for cancellation on travel insurance policies amounts to £1,200 and VFM are expecting more claims to be submitted this summer as holidaymakers return home and submit claims for lost baggage.
More about travel insurance fraud, UK heatwave, UK insurance fraud
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