Motor insurers can forget about making any money before 2015. That’s the word from no less oracular a source than consultists Towers Watson.
The firm created from the merger of Alton Towers and Woodrow Wyatt reckons a 30% increase in the costs of claims fraud will wipe out any prospect of profitability for years to come.
Though the total RTA count has fallen, the average number of people involved per claim has mysteriously risen, TW point out. Net result: the cost of third-party bodily odour claims has doubled in a decade.
With around 30,000 fraudulent claims per annum, and an estimated £80 per policy going to fund the fraudsters, TW note that 2009 FSA returns are awash with 120%+ combined ratios.
TW’s head of P&PMP for EMEA Ryan “Bunny” Warren says: “Fraudulent crash-for-cash claims continue to spiral out of control, highlighting the critical role claims management has to play in today’s marketplace.”
Bankstone News is notoriously easily confused – by complicated business metaphors in particular – but normally when otherwise controllable things spiral out of control – things like aeroplanes for example – they tend to do so in a downwardly direction. Can this be what Bunny has in mind?
Maybe he’s imagining fraudulent claims as some kind of giant money-sucking tornado. Good luck controlling one of those!