Insurance Companies Lost Rs. 30k Crore to Frauds in 2011

Indian insurance companies have collectively lost over Rs.30k crore in 2011 due to various frauds that took place in general and life insurance companies during the year. The study was conducted by a Pune-based company Indiaforensic, an anti-fraud and money laundering company.

The loss resulted in insurance sector is about Rs.30,401 crore which is roughly 9% of the total estimated size of the industry in 2011. Some of the reasons behind these frauds are, collusion between employees of insures and private persons, manipulation in citing cause of death to claim insurance benefits, documentation misrepresentation etc.

The total premium income according to the IRDA is around Rs.3.5 lakh crore. According to the study, the frauds in life insurance sector had more than doubled (103 per cent) whereas the frauds in the General Insurance sector rose by 70% in last five years. A total of Rs.15,288 crore was lost by the companies in 2007. The loss was pegged at Rs.30,401 crore in 2011.

India-forensic conducts fraud examination, risk management, security, and forensic accounting research. The experts in the company helped the country’s investigating agencies like CBI in several high profile fraud cases such as Multi-core Satyam scam case.

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