Why exaggeration may affect your credit rating

Insurance companies are toughening up on people who commit fraud, which may well spell trouble for those who tell 'little white lies', as well as complete cheats.

A survey conducted on behalf of insurer RSA found that under half of people (44 per cent) thought that insurance fraudsters were caught out, although three-quarters thought that if people were caught that their policy would be voided.

RSA also found that 1.2 million Brits do not regard insurance fraud as a 'serious crime', with 40 per cent knowing that it was wrong, but regarding it as a 'little fib'.

John Beadle, RSA's counter fraud manager, said: "The reality is that insurance fraud adds a significant amount to overall claim costs and it's the honest policyholders who are the true victims. Fraud adds an additional five per cent onto their insurance bills.

"Consumers need to be aware that in the near future we will be able to monitor fraud across a spectrum of financial products.

"So if a person commits fraud on an insurance claim and is detected, other financial services companies, such as mortgage lenders and credit card providers, will know and that will have an impact on the success of their application."

In 2004, an employment firm found that a quarter of applicants had lied on their CVs by misrepresenting their income or their previous job titles, qualifications or experience.

16/05/2008 12:16:19