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ABI: Life insurance fraud highly unusual
13 December 2007 12:00
Regardless of a recent, extremely high profile case of life insurance fraud, the Association of British Insurers (ABI) has claimed that this sort of crime is not really a problem.
John and Anne Darwin were both arrested following Mr Darwin's re-emergence this month, five years after he had disappeared while canoeing off the coast of Seaton Carew, near Hartlepool. During his absence, Mrs Darwin claimed around £25,000 on his life policy with Unat Direct insurance Management.
Yet ABI spokesperson John French insisted that the circumstances of this case are extremely unusual and that life insurance providers have numerous measures in place to minimise the threat of fraud, with the result that such incidents are indeed extremely rare.
He said claims can be made on life policies once there is proof the holder is deceased, although in cases such as the 2004 tsunami, insurers often pay out for people who had definitely been in the affected area even if there was no concrete evidence of their death.
What is of far greater concern at present is the fact that too few people recognise the value of life insurance at all, with a recent study by researcher BRMB showing that only two in five Britons have this type of cover.
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