In a recently compiled report, the Association of British Insurers has claimed that the UK’s car insurance industry has been subjected to a 70% increase in insurance fraud over the last 3 years. The fact that car owners are facing financial pressure from the credit crunch has led to widespread increases in debt. The signs are that many motorists are becoming desperate to cut costs any way they can and it appears that making fraudulent car insurance claims represents a way of cutting costs.

The ABI has calculated that car insurance premiums have risen by an average of £40 due to the prevalence of car insurance fraud. Unfortunately, there are no signs that this trend will discontinue. So the car insurance sector is facing a repetitive cycle, where more drivers are making more fraudulent claims and in turn UK drivers are being forced to pay higher insurance premiums.

There is no simple solution to this problem. Car insurance providers cannot be held responsible for the activities of motorists and motorists cannot themselves be held responsible for the UK’s current economic decline. However, it is a vehicle owner’s responsibility to abide by car insurance legislation.