Tuesday, 12 August 2014

Insurance fraud cases reduce by half, says IRA



Kenya: The number of insurance fraud cases reduced by more than half last year thanks to tighter supervision by the Insurance Regulatory Authority ( IRA)’s Insurance Fraud Investigation Unit.
According to the just released industry report for the year ended December 31, 2013, the unit received reports and detected cases of insurance fraud totaling 57 during the period compared to 133 similar cases in 2012.

The report shows that fraud remains highest in motor insurance category with 21 cases reported in the year, down from 35 the previous year.

Out of this, four fraudulent accident and 14 theft claims were made. Another three fraudulent cases of forged certificates were also reported.

There were three fraudulent claims in the medical insurance category down from six the previous year with two fraudulent funeral claims made in the year down from nine in 2012.

Fraud related to insurance agents also dropped with only six cases reported down from 38 the previous year. All the six reported cases were theft by insurance agents.

The level of fraud related to insurance companies especially theft by employees remained the same with 10 cases reported.

However, the number of firms operating without registration rose significantly from one in 2012 to five last year.

The Insurance Fraud Investigation Unit was established in 2011 by IRA to deal with cases of fraud in the insurance industry.

Last year, IRA said it received 800 complaints compared to 700 received in the previous year. Out of the complaints received, 80 per cent level of resolution was achieved.

The general insurance business underwriters incurred claims totaling Sh34.17 billion, reflecting a 16 per cent, up from Sh29.47 billion incurred in 2012.