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British Columbia auto insurer estimates more than 10% of claims have ‘element of fraud or exaggeration’


January 30, 2015   by Canadian Underwriter


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The Insurance Corporation of British Columbia announced Thursday its investigation units last year advanced 131 fraud-related charges to crown attorneys, noting that DNA evidence was used to prove an ICBC customer prohibited from driving was actually behind the wheel at the time of an accident, while another customer with only basic auto coverage was caught trying to buy optional additional coverage after a collision.

In a press release, ICBC published its top auto claims fraud files from 2014.

Testing of an airbag revealed a DNA match to a driver, insured by Insurance Corporation of British Columbia, who was prohibited from driving and claimed his vehicle had been stolen.

ICBC, which is owned by the province, is the carrier from whom all vehicle owners in B.C. must purchase basic coverage.

“In 2014, ICBC’s two special investigation units advanced 131 charges to Crown counsel against 100 defendants, maintaining our average conviction rate of approximately 90 per cent per year,” ICBC noted Jan. 29. “While it’s difficult to accurately calculate the extent of fraudulent activities, ICBC estimates 10 to 15 per cent of insurance claims contain an element of fraud or exaggeration, consistent with industry estimates.”

One customer “who was prohibited from driving claimed his vehicle had been stolen at the time it was involved in a three-vehicle crash,” ICBC stated. “Forensic testing of residue on the vehicle’s driver-side airbag revealed a DNA match to the customer and proved he was in fact the driver at the time of the crash.”

That customer was fined $1,000 after being found guilty of providing a false statement relating to an ICBC. The customer was also ordered to pay ICBC “more than $18,000 in claims costs and total loss payments paid out for the other two vehicles involved in the crash.”

Another case involved a woman with an expired licence who rear-ended another vheicle.

“The customer asked the driver in the other vehicle to tell ICBC the crash happened a day later so she could buy optional insurance, which would cover the damage to her vehicle,” ICBC recounted. “The other driver refused.”

Although the customer bought optional insurance after the collision, ICBC used the other driver’s statment “and time-stamped insurance transaction data” to deny the claim.