Insurance fraud on rise as money gets tight Articles / TenderSystem Posted by on Jul 05, 2008 - 10:52 AM Cash-strapped and desperate, many South Africans are reporting false hijackings, housebreakings and other theft claims in order to get rid of their monthly repayments and be paid out by insurance companies for the allegedly stolen goods. Insurance investigators report that there has been an increase in the number of people staging housebreakings to make extra money from insurance policies or claiming their vehicles were hijacked or stolen because they could no longer afford them. Marius Heystek, a senior partner at AM Heystek and Associates which specialises in insurance fraud, said the problem of false insurance claims had "always been there" but had now increased. "It is very clear when a house has not been broken into as the owner claims," he said. Heystek said people also inflated genuine claims where if, for example, a TV had been stolen, people would claim for extra items such as hi-fis and DVD players. A R20 000 claim would therefore increase to about R180 000. He said Mozambique was a popular country in which people who could no longer afford their car repayments could get rid of them before lodging a fake hijacking or stolen vehicle claim. "Upon investigation we often find that the "stolen" or "hijacked" vehicle had been in a neighbouring country one or two days before it was reported missing. Mozambique is very popular as they take it through the Kruger National Park," Heystek said. These vehicles ranged from "very expensive" BMWs and Mercedes to Toyotas, Nissans and bakkies. Click here! Viviene Pearson, Stakeholder Relationship Manager at the South African Insurance Association said although it had no official statistics, informal conversations with fraud and insurance companies did give the impression that there was currently an increase. "We are aware that sometimes when we have difficult economic environments, there is the tendency for these things to increase," she said. Willem Van der Vyver, managing director of Uphando Forensic Services, said other areas of insurance fraud included vehicle accidents that occurred late at night or early in the morning, often never reported to police. "In most of these cases your famous dog, cat, lamp pole or buck caused the accident. Once you do your investigation, you uncover that the driver was intoxicated," he said. A further area of concern was with claims relating to "all risk items" like electronic equipment and jewellery asthis was "normally an easy way" to fabricate a loss, Van der Vyver said. While the biggest surge of mortgage defaults in the United States in seven decades coincides with an increase in the number of cases of arson in foreclosed properties in that country South African insurance companies, investigators and police reported there were no recent cases of arson to either homes or cars. Mark te Water, deputy head of fire and emergency services in the eThekwini municipality, said there had been occasions over the years where circumstances around a fire had suggested arson, but in these cases, the information was handed over to police for investigation. He said arson occurred "from time to time" but could not say whether there had been a recent increase. SAPS spokesman Vincent Mdunge said arson used to be rife a few years ago in areas such as Chatsworth and Verulam, but that since the police had started working with companies the number of scams had subsided. Written by Bronwyn Gerretsen Cape Argus [1] This article is from ValueCard   http://www.valuecard.co.za/ The URL for this story is:   http://www.valuecard.co.za/modules.php?op=modload&name=News&file=article&sid=69 Links in this article   [1] http://www.capeargus.co.za/?fSectionId=3571&fArticleId=4503665&ap=1