Jonathan Hehir, CEO of Insuremyshop.ie, gives his opinion on fraudulent liability insurance claims.
Shops throughout the country are closing as a result of crippling fraudulent public liability claims and subsequent premium increases. False claims are a “plague” on many small businesses in Ireland, particularly those in retail, where some people attempt to sue after pretending to trip in a shop, or pretending to steal so they can accuse the store for defamation when questioned. From what we see on the ground, a significant portion of these cases in some shops are intentionally planned by criminals that have invariably benefited from similar exercises in the past.
We recently had a shop owner approach us for help in seeking public liability insurance, as he simply couldn’t pay his current premium. We managed to reduce his policy from €180,000 to €110,000 where he would be liable for the first €10,000 of each claim. Unfortunately, he couldn’t accept the quote due to then number of attempted claims each year, and was forced to close his successful business.
Aside from ‘diving’ and tripping, a major fraud issue for owners is the staging of ‘wrongful arrest’ or defamation, where fraudsters pretend to steal an item and accuse the shop of defamation if questioned.
Typically, these cases cost insurers between €5,000-€10,000. A customer might purchase an item at one till, before moving to another with a different item and also the original item purchased in view. They pay for the new item, and when asked by the staff member about the other, they create a scene with threats of a solicitor’s letter.
In some cases, an item bought in one shop is brought into another, and hidden under a jacket. When approached by shop security or staff, the perpetrator pretends to be unable find the receipt for the item but eventually does after causing as big a scene as possible. They then sue for wrongful accusation.
Minister Eoghan Murphy has said that work is now underway focusing on public liability insurance claims after the publication of the Report on the Cost of Motor Insurance in January. We hope he is treating the matter with the urgency and the seriousness that it requires and that he fully appreciates the stark reality many shop owners currently find themselves in as a result of growing claims fraud epidemic across the country.
Insuremyshop.ie and CFM Group are specialists in commercial and retail insurance. To see what we could do for your business, please call us on 01 231 9320 or visit our contact page.
Source: Dublin Live
