A smart(er) approach to insurance fraud

Insurance fraud is not one thing but many. For political reasons, this simple truth is often hidden, as cumulative figures describing the sum total of insurance fraud are deployed to bring about legal and administrative measures that favour the insurance industry. Rule design must recognise those apparently conflicting truths that insurance fraud is socially harmful and that the insurance industry's approach to counter-fraud is often self-serving. This paper draws on recent developments in the United Kingdom to show how incremental advances in the fight against fraud can be delivered without creating excessive opportunities for the insurance industry to limit the recovery of honest claims.