Insurance fraud – how it affects everyone

November 20th, 2019

In September the Insurance Council of New Zealand (ICNZ) launched the Insurance Fraud Bureau (IFB), New Zealand’s first integrated initiative to target insurance fraud through detection and education.

In 2018 insurance fraud was estimated to have cost the general insurance sector up to $614 million, around 10% of gross written premiums.

Tim Grafton, ICNZ Chief Executive, says: “Sadly, if you’re paying for insurance, then you’re paying for insurance fraud, with a portion of all policyholder premiums covering claims that have been made through deception, dishonesty and dissimulation.

Until now, work to address general insurance fraud in New Zealand hasn’t been coordinated across the industry. The IFB will change that. All ICNZ’s members are members of the IFB, which means that for the first time, general insurers in New Zealand are working together to reduce the impact of insurance fraud on all customers.

The IFB’s biggest role is to educate everyday New Zealanders about what insurance fraud actually is and what engaging in it could mean for policyholders.

Of the small percentage of people who commit insurance fraud, many do so in the belief that it’s the normal thing to do.

“While insurance fraud is illegal in New Zealand it is common to hear people talk about inflating insurance claims or claiming for accidents that didn’t happen. For some people, this is seen as getting what’s owed to them by their insurer. At the other end of the spectrum, insurance fraud can be a means to financing organised crime.”

However, the consequences of fraud are severe. Among other things, those who commit fraud could lose their ability to get insurance permanently.

Financial Advisers and Brokers can also play a part in supporting the IFB. “We need your help to get the message out. Talk to your clients and explain to them the cost and consequences of insurance fraud. Help them understand that it’s not common and it does have victims – like their mum and their grandad and their neighbour. “

Brokers and Advisers can walk their customers through what could happen to them if they’re caught, with a resources to help available on

Ultimately, insurance fraud is an issue we all need to care about. Through care and attention, and effective public education, together we can reduce the burden on all policyholders.

Anyone wanting to report insurance fraud may do so by visiting, by calling 0508 372 835 or by emailing