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25% of insurance claims are fake – NIC

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The Commissioner of Insurance, Dr. Justice Ofori, says about 25% of insurance claims are fake.

In Accra on Tuesday, Dr. Ofori said about a quarter of all claims made on insurers, by clients, are fictitious; and are either inflated or staged, ostensibly to fleece the companies of their investments.

He said some clients even go as far as staging their own death or the death of a relative to claim life insurance.

He warned that the rising incidence of fraudulent claims on insurers, by the insuring public, risks raising the cost of insurance, resulting in corresponding increases in the premiums that clients must pay to insure themselves and properties against eventualities.

He said fraudulent claims stood at 40 per cent globally and stressed the need for insurance claims to be properly investigated to reduce the incidence of companies paying claims for events that did not occur.

The Commissioner of Insurance said although the malpractice is global, it is also endemic in the country, with clients developing the habit of claiming for things that did not occur. He said there is the need for insurance companies to be meticulous in their investigations of claims to ensure that payments are for genuine claims.

“Claims investigations are very important to actually weed out such fraudulent instances. So, it is the responsibility of insurance companies that have to pay these claims to investigate to ensure that they are paying only legitimate claims,” Dr Ofori added.

Explaining further, the Commissioner of Insurance said insurers also needed to be conversant with their job by always ensuring that the damages claimed for were capable of happening in the case of non-life insurance.

He recalled an incident in which a client whose vehicle bumper was damaged in an accident submitted a claim that requested repairs and/or payments to cover damages to the sunroof, lower axle and the shocks of the vehicle.

Dr Ofori said it was obvious that such a claim was fraudulent but an insurance practitioner who does not appreciate the parts of a vehicle may have difficulty detecting that early

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