Warning over new ‘flash for cash’ insurance scam

Criminals gangs tricking motorists before intentionally crashing into them

Investigators are warning about a new tactic by criminal gangs, dubbed ‘flash for cash’, where a driver flashes their lights to let another driver out of a junction, and then crashes into them deliberately.

The criminals then make money by putting in false personal injury claims for whiplash and loss of earnings, as well as submitting fake bills for vehicle recovery, repair and replacement car hire.

The Asset Protection Unit, which investigates fraud in collaboration with police and the insurance sector, has warned that the fraudsters often target elderly motorists or women with young children – drivers they believe will not challenge them on the scene.

And the new scam is harder to prove in court, because it comes down to the innocent driver’s word against the criminal’s that they flashed their lights to let them out.

 The number of flash for crash scams are not known, but the IFB estimates that 380 fraudulent personal injury claims from deliberate crashes are made every day and cost the motor insurance industry £392m every year.

 Detective inspector Dave Hindmarsh from the Metropolitan Police told the BBC: “[There are] emotional costs if you’re involved in a crash: you could well lose your confidence, and if your passengers are children they may well become wary of being passengers in cars, and of course you may get injured or killed.

 “It’s an extra £50 to £100 on every person’s premium, so that’s a financial cost.”

 

This article has been taken from The Insurance Times dated 16th August 2013 

http://www.insurancetimes.co.uk/warning-over-new-flash-for-cash-insurance-scam/1404027.article

Time to sharpen up your approach to health & safety

The ‘Sentencing Guidelines’ introduced in England and Wales in 2016 saw a significant rise in the size of fines being handed down by the courts in health and safety cases. In 2016, nineteen companies received fines of a million pounds or more, compared to only three in 2015 and none at all in 2014. Further to the increase in financial penalties 46 company directors and senior managers were prosecuted under health and safety laws in 2016 and prison sentences are becoming increasingly likely. Businesses operating north of the border should recognise that the Scottish courts are likely to follow the English and Welsh Sentencing Guidelines.

The Guidelines have made it more important than ever for your business to proactively manage their health and safety provisions which should include your Health and Safety Policy, risk assessments, safe systems of work and staff training. If your health and safety documents are hiding in a dusty folder on the shelf which, for example, only gets opened every six months to record the details of the fire drill then they would definitely benefit from a thorough review. Not only should they be up to date and accurately reflect your business activities but they should also have been communicated throughout your business and be understood by all your employees.

The reasons for having practical, effective, specific and up to date health and safety documentation are compelling but what about aspects beyond the ‘paperwork’ – the human element?

A safety culture (good or bad) within a business can be determined by what its employees actually do rather than what they say and this applies from the boardroom to the shop floor. Attitudes and behaviours demonstrated by all employees are a good barometer of the health and safety culture within a business.

‘Safety culture’ is a frequently used term, but what does it actually mean and how do you measure it?

A safety culture cannot be bought off the shelf as a package; it takes determined commitment and involvement, an understanding of the required outcomes and how these will be achieved and genuine desire for it to succeed.

While the sentencing Guidelines do not impose any further burden upon business the consequences of a successful prosecution now even further outweigh the costs of taking the time and effort in implementing and maintaining a robust health and safety management system.

If you would like to discuss a review of your health and safety management systems or to learn more about the benefits of introducing and sustaining a positive health culture please contact the TL Dallas Risk Management team by emailing riskmanagement@tldallas.com.

A Change to the Ogden Discount Rate: How to Mitigate the Premium Increases Ahead

In February 2017, the Lord Chancellor announced a significant reduction to the Ogden Discount Rate of 2.5%, to the revised level of -0.75%, causing UK insurer shares’ to plummet and sparking reaction from the insurance industry – who was expecting the rate to fall to around 1.5%.

 

So, what is the Ogden discount rate?

  • It is a calculation used by the courts to determine how much insurance companies should pay out to customers in cases of life-changing injury
  • When victims of life-changing injuries accept lump sum compensation payments, the actual amount they receive is adjusted according to the interest they can expect to earn by investing it
  • The Discount Rate is linked, by law, to returns on the lowest risk investments – typically index-linked gilts. The yield on these gilts, or Government bonds, has fallen dramatically since 2001

 

The reduction means that those suffering from serious injuries will receive significantly higher compensation payments than before. Mike Mitchell, Group Broking Manager at TL Dallas observes, “this change has caused insurers to revisit their reserves for existing claims to ensure they have sufficient funding set aside to meet future liabilities; Aviva has announced that this change has increased its Combined Operating Ratio from 94.9% to 106.3%, QBE has announced that it is setting aside an additional $160m in reserves.”

The effects of this will be that insurance that covers bodily injury – principally Motor, Employers’ Liability  and Public Liability – will need to be re-priced to ensure the premiums generate adequate funds. Furthermore, some insurers may well choose not to underwrite these classes of business, so there may also be a contraction in the market supply. The net effect is that premiums will inevitably go up and insurers will become more selective.

Gary Foggo, Health & Safety Consultant at TL Dallas, commented, “now is the time for companies to proactively review their risk management procedures, as well as risk transfer solutions and claims defensibility.”

To combat price increases, businesses will need to demonstrate and evidence how well they manage their risks to ensure they are ‘top of the underwriter’s pile’ come renewal. Firms with resilient and demonstrable health and safety procedures (which drive attitude, behaviours and culture) will be in a stronger position to lessen the knock-on effects.

The first step to controlling risk in the workplace is hazard identification. Thereafter, it is down to control measure implementation and the effective documentation of both. He adds, “it is impossible to eliminate all risks and prevent every accident, but when an accident does occur it is vital a company has the resources available to minimise the effect; that processes are robust; and that documentation is available to defend the claims.”

As part of the process of risk management, businesses should also be considering risk transfer: working with their broker to explore whether their limits of cover and sums insured remain adequate, given the potential change in exposure as the revised Ogden Discount Rate takes effect.

What should you do?

Speak to your broking team. Companies should get support from a qualified risk management professional who will work with you and your broker to review your internal processes and advise on a relevant approach to ensure a safe workplace and proactively manage claims when they do occur.

If you would like to discuss this matter further, please contact our Health & Safety Consultant, Gary Foggo – gary.foggo@tldallas.com or call 0131 322 2641.

Warning over new ‘flash for cash’ insurance scam

Criminals gangs tricking motorists before intentionally crashing into them

Investigators are warning about a new tactic by criminal gangs, dubbed ‘flash for cash’, where a driver flashes their lights to let another driver out of a junction, and then crashes into them deliberately.

The criminals then make money by putting in false personal injury claims for whiplash and loss of earnings, as well as submitting fake bills for vehicle recovery, repair and replacement car hire.

The Asset Protection Unit, which investigates fraud in collaboration with police and the insurance sector, has warned that the fraudsters often target elderly motorists or women with young children – drivers they believe will not challenge them on the scene.

And the new scam is harder to prove in court, because it comes down to the innocent driver’s word against the criminal’s that they flashed their lights to let them out.

 The number of flash for crash scams are not known, but the IFB estimates that 380 fraudulent personal injury claims from deliberate crashes are made every day and cost the motor insurance industry £392m every year.

 Detective inspector Dave Hindmarsh from the Metropolitan Police told the BBC: “[There are] emotional costs if you’re involved in a crash: you could well lose your confidence, and if your passengers are children they may well become wary of being passengers in cars, and of course you may get injured or killed.

 “It’s an extra £50 to £100 on every person’s premium, so that’s a financial cost.”

 

This article has been taken from The Insurance Times dated 16th August 2013 

http://www.insurancetimes.co.uk/warning-over-new-flash-for-cash-insurance-scam/1404027.article